Appeal from the Superior Court of Cook County; the Hon. SAMUEL
B. EPSTEIN, Judge, presiding. Decree affirmed in part and
reversed in part and cause remanded with directions.
MR. PRESIDING JUSTICE SCHWARTZ DELIVERED THE OPINION OF THE COURT.
This suit involves multiple causes, defendants and orders. Plaintiff, J.C. Else Coal Company, was in need of a place in which to conduct its coal business. Miller and Banker, defendant, which was also in the coal business, occupied premises at 6543 Wentworth Avenue, Chicago, Illinois, under a lease which prohibited subleasing without the written consent of the lessors. It entered into a contract with plaintiff, whereby plaintiff was given the right to operate its business on the same property. The fee owners, with Miller and Banker joining, sold the property to the County of Cook and divided the proceeds. The county took possession and ousted plaintiff. Plaintiff claims that it is entitled to a portion of the proceeds derived from the sale, seeks to impose a constructive trust on such proceeds for the value of its interest, and seeks to recover from the county for the alleged unlawful ouster.
On motions to dismiss, to strike and for summary decree, the chancellor dismissed the complaint as an equity proceeding, but sustained it as an action for damages against Miller and Banker and reassigned the case to a common-law court for trial thereon. The chancellor also included a proper provision as required by sec 50(2). (Ill Rev Stats, c 110, § 50(2) (1963).) From this order plaintiff has appealed. The issues are complicated and will be better understood following a more complete statement of the facts as derived from the pleadings.
Miller and Banker leased the property on July 1, 1956 from Maude T. Miller (since deceased and executor substituted) and Martha J. Dyck, whom we will hereinafter refer to as the "fee owners," including in that term Franz W. Dyck, whose only interest appears to be as the husband of Martha J. Dyck. The lease was for a period of five years ending June 30, 1961, with the right to extend the term for an additional five years, provided lessee gave written notice not less than three months prior to the expiration date, that is, before March 30, 1961. The lease prohibited the assigning or subleasing of the premises without the written consent of the owners.
On October 20, 1958, Miller and Banker entered into a written agreement with plaintiff. This agreement recited that the property on which Else Coal Co. was then conducting its business had been condemned by the state for a highway; that it needed a location from which to continue its business; that Miller and Banker had a coal yard under lease for a term of five years, expiring June 30, 1961, with the privilege of extension for another five years and was desirous of having Else Coal Co. buy from it all the coal it would need in the conduct of its business and operate out of the Miller and Banker yard until June 30, 1966, and as the Else Coal Co. was desirous of conducting its business from the Miller and Banker yard, it was agreed that Miller and Banker would in apt time prior to June 30, 1961, serve due notice to extend its lease for the term of five years. Other provisions required Miller and Banker to sell and Else Coal Co. to purchase all of the Else Coal Co.'s coal requirements at prices fixed in the agreement. Miller and Banker agreed that during the entire period it would pay the monthly rental due under its lease and under the five-year extension thereof. Nothing is said in the agreement about the consent of the owners to the arrangement. The complaint, however, alleges that the agreement was made with the owners' consent. It does not recite that this consent was in writing, as required under the terms of the lease if the arrangement be considered a sublease. The agreement appears designed to avoid designation as a sublease.
On or about June 7, 1960, the Board of Commissioners of Cook County by resolution authorized the Superintendent of Highways to negotiate for the purchase of the property. The negotiations were conducted with Miller and Banker through Catherine Ryan, its president, and with the owners of the fee. Thereupon an agreement was entered into between Miller and Banker, Catherine Ryan and others as heirs-at-law of James M. Ryan, deceased, and Martha J. Dyck and Franz W. Dyck, as the husband of Martha J. Dyck. It recited that the county was about to make an offer of approximately $218,000 for the property, but had indicated that no such offer would be forthcoming without an agreement being reached "between the parties hereto" (being those parties hereinbefore mentioned) as to the disposition of the proceeds. It then provided that out of the sum of $218,000, $90,000 would be paid to the fee owners and the balance of $128,000 to Miller and Banker. The disparity between the amount paid to the owners and that paid to Miller and Banker is explained by the fact that the latter was entitled under its lease to remove valuable buildings and improvements. The agreement then recited that it was contingent upon the ability of the owners to convey a good and merchantable title, subject only to the interest of Miller and Banker, Inc., as lessee. The sale was completed and the money was paid as agreed.
On January 6, 1961 notification of the sale was given to plaintiff by Miller and Banker and plaintiff was further notified that it would be required to quit the premises not later than March 15, 1961. Plaintiff remained in possession until May 5, 1961, when the defendant County of Cook entered the premises, demolished the coal yard rail spur and forced the cessation of plaintiff's business. At no time during the pendency of the negotiations for the sale of the property was plaintiff informed of the pending sale nor, so far as appears from the record, was the county informed of plaintiff's interest. No action was taken by plaintiff following receipt of notice and before being ousted by the county. Miller and Banker never exercised its option to extend its lease.
The amended complaint consisted of three counts. The first count is directed against all the defendants. In addition to the facts hereinbefore stated, it alleged that the owners were informed of the occupancy agreement; that they consented thereto; that plaintiff entered into "joint possession and occupancy" on May 1, 1959, caused its name to be painted conspicuously on certain fences, buildings, office and equipment, and used the same until May 5, 1961; that the owners had actual knowledge that plaintiff was an "occupant"; that they neglected to inform plaintiff of the negotiations, sale, and receipt of proceeds, but fraudulently concealed this from plaintiff for the purpose of depriving it of its share thereof; that plaintiff continued its operations on the premises until May 5, 1961, when the County of Cook entered the premises and forced the cessation of plaintiff's business; that plaintiff thereupon closed its doors, sold its business and fixtures at distress prices, and thereby incurred substantial monetary loss. The prayer seeks disclosure as to the facts with respect to the sale and distribution of the funds, the determination in an accounting of the fair share of plaintiff therein, an injunction, and other incidental matters.
Count II is against the County of Cook. It avers that the county was charged with knowledge of plaintiff's interest by reason of its possession, and that the plaintiff is entitled to compensation for the county's taking of the property.
Count III is directed against Catherine Ryan, charging that she received a portion of Miller and Banker's $128,000 which she concealed from the plaintiff and that it is entitled to an accounting from her.
We will consider the first count as it applies to both the owners and to Miller and Banker.
To support its theory that the constructive trust doctrine is applicable to the facts, plaintiff quotes extensively from the broad language used by legal writers, in encyclopedias and texts, and by the courts in describing constructive trusts. It leads with a sweeping statement from 54 Am Jur, sec 218, pp 167-68:
"A constructive trust . . . is [one] . . . which arises . . . against one, who by fraud, . . . by duress or abuse of confidence, by commission of wrong, or by any form of unconscionable conduct, artifice, concealment, or questionable means, or who in any way against equity and good conscience, either has obtained or holds the legal ...