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Keehner v. A.e. Staley Manufacturing Co.





APPEAL from the Circuit Court of St. Clair County; the Hon. WILLIAM J. SUNDERMAN, Judge, presiding.


Plaintiff, Jim E. Keehner, brought suit against A.E. Staley Manufacturing Company, defendant, contending that losses he suffered in the commodity futures market were due to unauthorized transactions by Staley's agent, Fred H. Cash. Staley counterclaimed for the amount of the debit balance due after Keehner's account was closed out following his refusal to meet margin calls. Trial was had to the court sitting without a jury. Judgment was entered in favor of Staley on plaintiff's complaint and on its counterclaim.

We will deal initially with plaintiff's allegation of procedural errors. Specifically, plaintiff attacks the granting of defendant's motion for a change of venue from all judges of the Twentieth Judicial Circuit and alleges prejudice on the part of the trial court against him.

• 1 Plaintiff attacks the motion as not containing specific allegations of prejudice and as being granted after a ruling on a substantive matter. It is a correct statement of the law that a motion for change of venue, when directed at several judges, should contain specific allegations of prejudice. (Rosewood Corp. v. Transamerica Insurance Co., 57 Ill.2d 247, 311 N.E.2d 673.) However, we consider the allegations contained in the motion to be sufficiently specific to meet this requirement. The motion alleges that the plaintiff had appeared before the judges of the twentieth circuit for approximately 15 years as a practicing attorney and the possibility of prejudice in his favor on the part of the judges when he appeared before them as a party litigant might prevent the defendant Staley from receiving a fair trial. It was further alleged that a judge of the circuit had ordered the deposition of a witness for Staley to be taken, not in Chicago, the place of the witness' residence and the usual choice of the place to take a deposition, but in St. Clair County, the place of residence of the plaintiff. This instance was offered as an example of special consideration already extended to Keehner.

• 2, 3 It is also correct that a motion for change of venue should not be granted if the court has already ruled on a substantive matter. (Frede v. McDaniels, 37 Ill. App.3d 1053, 347 N.E.2d 259; Ill. Rev. Stat. 1975, ch. 146, par. 3.) In this instance the court had already denied plaintiff's motion for summary judgment. It was therefore error to grant the motion. However, we have been cited to no cases nor are we able to find any where the granting, as opposed to the denial, of a motion for change of venue has been the grounds for a reversal, especially where there is no showing of prejudice to the nonmoving party by reason of the granting of the motion. Here plaintiff merely alleges that he was "exposed to trial" before a judge not of his choosing. A great many litigants could say the same. We are of the opinion that the error was harmless. The record of the actions of the trial court need not be free of any error. (Tarala v. Village of Wheeling, 25 Ill. App.3d 349, 323 N.E.2d 454.) The error complained of must have affected the outcome of the trial to constitute grounds for reversal. (Phillips v. Shell Oil Co., 13 Ill. App.3d 512, 300 N.E.2d 771.) In the instant case there has been no showing of prejudice to the plaintiff affecting the outcome of the trial or that prejudice arose simply because the trial was heard by a judge from a circuit other than the twentieth.

• 4 Next plaintiff contends that the actions and remarks of the court during the conduct of the trial evidence that the court was prejudiced against him. Suffice it to say that we have examined the record in its entirety and neither the remarks and actions of which plaintiff complains nor any others establish prejudice on the part of the trial court. Plaintiff then alleges that the fact of social contact between the judge and representatives of the defendant while the trial was in progress reveals prejudice on the part of the court. Specifically, he alleges that the trial judge and both attorneys for Staley, the wife of one of the attorneys, and a witness for Staley had breakfast together on the morning of the second and last day of trial. Regardless of what our reaction might be if such an incident were shown by the record a mere allegation contained in a brief is not sufficient to bring such a matter to the attention of a reviewing court. It is so obvious as to require no citation of authority that a reviewing court may not take notice of matters dehors the record. This matter is certainly one which falls within that category.

Plaintiff next alleges that the judgment was contrary to the manifest weight of the evidence and contrary to law. A recital of the facts out of which the dispute arose is therefore necessary.

Plaintiff is an attorney practicing in Belleville, Illinois, in the Twentieth Judicial Circuit. On April 15, 1974, Keehner opened a commodity futures trading account with Fred H. Cash, a commodities broker in Champaign, Illinois. Cash was doing business as Fred H. Cash and Company, placing commodity orders through A.E. Staley Manufacturing Co. The complaint alleged that Cash was an agent of Staley, and the same was admitted by Staley in its answer. On the "Commodity Customer Confidential Account Information" sheet which Keehner filled out he indicated his net worth at $120,000 and his net liquid worth at $15,000. He also filled out a "signature card" which bore the following language:

"I hearby agree that all transactions executed for my account are subject to the rules and customs of the Exchange (and its Clearing House, if any) where executed. I further agree that I will at all times without notice or demand from you maintain and keep my account fully margined and protected, in accordance with your requirements and that you will be kept secure by me against fluctuations of the market price of the commodities in my account. In case of my failure to maintain with you at all times such margin as you may deem adequate for your protection, you may, without prior demand or notice to me, sell and or purchase such commodities as you may consider necessary to fully protect my account."

Keehner was also given a 40-page pamphlet entitled "Understanding the Commodity Futures Market."

Plaintiff placed $500 with Cash the day the account was opened. He testified he told Cash that day that he could not afford to involve more than $3,000 to $5,000 in the market. Cash's testimony was that Keehner might have said this but that he (Cash) never guaranteed to Keehner that he could limit losses in this way. Cash transacted commodity trades for plaintiff's account for the next three months. Cash testified that around June 15 plaintiff called him wanting "more action" in the account. Plaintiff denied this. Over this period of time plaintiff met several margin calls, all for relatively small amounts, the largest being for $800. As of July 24, 1974, plaintiff's original $500 plus margin calls totaled $2,600. His account showed total profits as of that date of $26,000. On July 15 Cash persuaded Keehner to purchase and take delivery of a bar of platinum for $8,813. Plaintiff testified that he told Cash not to speculate with the platinum as he intended to keep it for at least a year. He also testified that he told Cash at this time to use only the profits in the account and not to involve the $2,600 he had actually paid in to date. Cash disputed this testimony.

On July 21 and 22, plaintiff received margin calls for $2,800 and $3,625 which were dated July 18 and 19. Plaintiff testified that he contacted Cash about these calls since they were for considerably more than any previous margin calls and was told he would not have to meet them, that the market would soon "straighten itself out." Cash testified that it was not necessary to meet these calls as there was money available upon liquidation of certain commodities in the account to supply sufficient margin.

On July 25, plaintiff received a telegram from Staley indicating that he had one-half hour to wire $14,000 to Staley in order to keep the account margined. This call was met by selling the platinum for $10,000 and an additional deposit by plaintiff of $4,000. There is a dispute in the evidence as to whether the platinum bar was sold as a result of an agreement between plaintiff and Cash or whether plaintiff was informed after the fact. It is undisputed that plaintiff gave Cash a check for an additional $4,000.

Plaintiff testified that he told Cash at this time that he (Cash) had violated his orders not to involve him in transactions with a possibility of loss above $5,000, that Cash should admit this to Staley and tell them not to issue any more margin calls and not to close his account. The market trend which caused the large margin calls continued. Staley issued more margin ...

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