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Murray v. Korshak

SEPTEMBER 4, 1964.




Appeal from the Superior Court of Cook County; the Hon. DANIEL A. COVELLI, Judge, presiding. Judgment affirmed. MR. PRESIDING JUSTICE SCHWARTZ DELIVERED THE OPINION OF THE COURT.

This is an appeal by defendant Maurice Korshak, a partner in the firm of Korshak & Korshak, from a judgment confessed on a judgment note executed on behalf of the partnership by defendant Sydney Korshak, partner and brother of Maurice. The complaint was entitled substantially as hereinabove shown and the judgment was confessed against the partnership in that style. The same caption should have been used in the briefs. Defendant-appellant Maurice Korshak, by using a caption which makes it appear that the suit was against the defendants as individuals, confuses the principal issues, which involve the application of the Partnership Act and the statutes relating to confession of judgment. The Illinois Civil Practice Act provides that a partnership may be sued either in the names of the partners as individuals doing business as the partnership, or in the firm name, or both. Ill. Rev Stats c 110, § 27.1(1) (1963).

The note in question dated April 1, 1962, was for the sum of $19,000 and was given for services and material furnished the partnership. It was signed "Korshak & Korshak, partnership, by S. Korshak, co-partner." It is not denied that this was a partnership engaged in the contracting business, and that the partnership was composed of Maurice and Sydney Korshak. The suit was filed on August 2, 1963, and a judgment was entered on August 6, 1963, upon confession by one James J. Mahoney, an attorney, pursuant to the confession of judgment clause in the note.

On September 3, 1963, a motion was filed on behalf of Maurice to vacate the judgment, supported by his affidavit that he had been diligent in the preservation of his rights and had a good defense on the merits; that the partnership of Korshak & Korshak did not owe plaintiff the sum of $19,000 or any part thereof; that Sydney Korshak executed the judgment note, and that Sydney alone consented to the confession of judgment, without the signature, consent or approval of all the partners of said partnership, contrary to law; that he, Maurice, was a partner, and that he did not sign the judgment note nor did he consent to the execution thereof or to the confession against the firm or against himself individually, and that the judgment is invalid; that the execution of the note was without consideration; that he did not have notice of the judgment until August 16, 1963, when he read of it in a Chicago newspaper, whereupon he immediately consulted his attorney and took steps to vacate it.

The court treated the notice not as one to vacate, but as a motion to open the judgment, which was its true character, and on September 6, 1963, entered an order opening the judgment, granting Maurice five days to file his defense on the merits, and giving plaintiff five days thereafter to file his reply. This was in accordance with the provisions of Supreme Court Rule 23 (Ill. Rev Stats c 110, § 101.23 (1963)) as follows:

"A motion to open a judgment by confession shall be supported by affidavit in the manner provided by Rule 15 for summary judgments, and shall be accompanied by a verified answer which defendant proposes to file. If the motion and affidavit disclose a prima facie defense on the merits to the whole or a part of the plaintiff's demand, the court shall set the motion for hearing. The plaintiff may file counteraffidavits. If, at the hearing upon the motion, it appears that the defendant has a defense on the merits to the whole or a part of the plaintiff's demand and that he has been diligent in presenting his motion to open the judgment, the court shall sustain the motion either as to the whole of the judgment or as to any part thereof as to which a good defense has been shown, and the case shall thereafter proceed to trial upon the complaint, answer and any further pleadings which are required or permitted. . . . The issues of the case shall be tried by the court without a jury unless the defendant or the plaintiff demand a jury and pay the proper fee (if one is required by law) to the clerk at the time of the entry of the order opening the judgment. . . ."

[2-4] The distinction between a motion to vacate and a motion to open should be noted. A motion to vacate questions the jurisdiction of the court over the party or the subject matter. It is not necessary that the defendant show a meritorious defense to the claim. The only question is whether the judgment is void for want of jurisdiction, unless lack of jurisdiction is waived by the entry of a general appearance. Green v. Walsh, 5 Ill. App.2d 535, 126 N.E.2d 398; Goldberg v. Schroeder, 10 Ill. App.2d 186, 134 N.E.2d 615. A motion to open a judgment, on the other hand, is made for the purpose of allowing the defendant to present a defense on the merits. Supreme Court Rule 23, Ill. Rev Stats c 110, § 101.23 (1963). All that is required on such a motion is that the defendant show that he has a meritorious defense and has been diligent in presenting it. If the court allows the motion, the case then proceeds to trial on the merits, as it did here.

Maurice did not stand on his motion as one to vacate and he made no objection to the order of the court opening the judgment. In fact, he accepted it, filed a defense and went to trial on the merits. This defense, sworn to by him, again sets forth that he did not sign the judgment note nor did he authorize or empower any other person to sign it; that Sydney signed it as a single partner on behalf of the partnership, without the knowledge, consent or approval of Maurice as a partner. Maurice, as a further defense, also averred that the judgment note was made without consideration, and that neither he nor the partnership owed the money sued on, or any part thereof. To this defense plaintiff filed a reply which admitted that Maurice did not sign the note, but averred that he authorized Sydney to sign it. It denied that the note was without consideration and averred that the money was due for labor and material furnished to the partnership. Maurice did not demand a jury trial, as he could have done under the Supreme Court Rule 23, supra. A hearing was had on the merits of the case on October 21, 1963.

The evidence on behalf of plaintiff revealed that at a meeting in the partnership office in April 1962, plaintiff demanded payment of the money due him from the partnership; that both Sydney and Maurice were present; that Sydney told plaintiff the partnership did not have the money; that they would give him a note; that Maurice handed the note to Sydney and Sydney signed it and gave it to the plaintiff. Present at the meeting besides those hereinbefore mentioned were Sydney's son Arnold, John Dondalski and John Curtin, contractors. They all testified for plaintiff and supported his case, except John Curtin, who did not testify, and Maurice, who testified on his own behalf. He denied that he had authorized execution of the confession of judgment note. His only testimony with respect to the merits of the claim here involved was that he had met plaintiff on an occasion and had a conversation with him relative to finances, and that plaintiff did not ask him for payment. He testified that he asked plaintiff how much money he had coming out of the building, and plaintiff said about $3000. Maurice further testified:

"I told him I thought all of his money had been paid out by the bank, that the payouts were from the bank. I did not know of my own knowledge how much Mr. Murray had coming. That is the only time I talked to Mr. Murray about his balance due on Sheridan Road.

I heard the witnesses testify as to my presence . . . on the date the note was signed. I was not there. I did not authorize my brother to sign this note. I did not see my brother make out the note. I was not there at that time, so I could not see anything." (Emphasis added.)

Theodore Korshak, a brother of Maurice and Sydney, testified on Maurice's behalf, but he was not present at the meeting and knew nothing of the facts concerning Sydney's authority to sign the note. At the end of the testimony the trial court said:

"Well, Gentlemen, you have four witnesses on one side who told one story under oath and one witness on the other side. If there is strife in this family which discounts Sydney's testimony and if we discount Arnold's testimony, we still have the testimony of Mr. Murray and Mr. Dondalski. There is no reason why the court should disbelieve them."

Thereupon the court entered the order denying the motion to vacate the judgment, and ...

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