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08/30/88 Galvin Kennedy, v. Barbara Miller Et Al.

August 30, 1988

GALVIN KENNEDY, PLAINTIFF-APPELLANT

v.

BARBARA MILLER ET AL., DEFENDANTS-APPELLEES

THE REQUIREMENTS FOR APPOINTMENT OF A RECEIVER WERE NOTED IN BAGDONAS

v.

LIBERTY LAND & INVESTMENT CO. (1923), 309 ILL. 103, 110, AS FOLLOWS:



APPELLATE COURT OF ILLINOIS, SECOND DISTRICT

528 N.E.2d 406, 174 Ill. App. 3d 48, 123 Ill. Dec. 861 1988.IL.1326

Appeal from the Circuit Court of Du Page County; the Hon. S. Bruce Scidmore, Judge, presiding.

APPELLATE Judges:

JUSTICE NASH delivered the opinion of the court. INGLIS and DUNN, JJ., concur.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE NASH

Plaintiff, Galvin Kennedy, appeals from the denial of his petition for appointment of a receiver. Kennedy initially brought this action against defendants Barbara and Laurence Miller, seeking a judgment for amounts allegedly due him from a joint venture he had undertaken with the Millers. The trial court found that a joint venture existed between the parties and ordered an accounting of joint venture assets. Ultimately, a summary judgment was entered in favor of Kennedy awarding him $194,204. The Millers appealed and posted an appeal bond to stay execution of the judgment. (107 Ill. 2d R. 305.) The bond was in the form of cash deposited by defendants in an interest-bearing bank account. On that appeal, this court affirmed the circuit court's findings that there was a joint venture between the parties and that Kennedy was entitled to an accounting; however, the summary judgment in favor of Kennedy was reversed, and the cause was remanded with directions that the Millers be granted a new trial of the accounting issues and Kennedy's right to profits. Kennedy v. Miller (1987), 156 Ill. App. 3d 1171 (unpublished Rule 23 order).

After our mandate in the first appeal was filed in the trial court, Kennedy petitioned the court for the appointment of a receiver to take custody of the cash which comprised the appeal bond. The petition, which was supported by numerous exhibits and affidavits, alleged that the funds held as the appeal bond represented the profits of the joint venture, that as a joint venturer, Kennedy had an interest in the funds, and that a receiver was necessary because the cash would be in imminent danger of loss if it was released to the Millers due to the Millers' alleged potential insolvency and financial difficulties. Hearing on the petition consisted solely of arguments of counsel, and no testimony or other evidence was offered. The trial court denied the petition and allowed the release of the appeal bond money to the Millers.

Kennedy brings this interlocutory appeal pursuant to Supreme Court Rule 307(a)(2) (107 Ill. 2d R. 307(a)(2)), which provides for appeals from an order refusing to appoint a receiver, and he also filed a motion in this court to stay the trial court's order allowing the release of the appeal bond funds. That motion was denied for Kennedy's failure to post a required appeal bond, and according to the parties' briefs, the cash appeal bond was released to the Millers shortly thereafter.

Kennedy contends that the trial court abused its discretion in refusing to appoint a receiver since, under the circumstances of this case, the requirements for such an appointment were met. The Millers respond that the trial court acted properly because the cash deposited as the appeal bond was not shown to be an asset of the joint venture, and did not represent such an asset, and thus could not properly be placed in the custody of a receiver. We conclude that the appeal must be dismissed.

In our view the matter pursued here by Kennedy is moot. A case may become moot when, during the pendency of an appeal, events occur which make it impossible for a reviewing court to grant effective relief to a party. (In re Marriage of Holem (1987), 153 Ill. App. 3d 1095, 1098, 506 N.E.2d 739; Bundy v. Church League of America (1984), 125 Ill. App. 3d 800, 803, 466 N.E.2d 681.) Changed circumstances, such as occurrences that prevent a reviewing court from granting plaintiff the relief he originally sought, also may render an issue on appeal moot. (Schnepper v. American Information Technologies, Inc. (1985), 136 Ill. App. 3d 678, 681, 483 N.E.2d 987.) Because of the events which followed the filing of notice of appeal, the relief sought by Kennedy in this case can no longer be granted.

Kennedy's petition in the circuit court requested that the money deposited as the Millers' appeal bond in the first appeal from the judgment against them be placed in the custody of a court-appointed receiver. The petition was denied, and, despite Kennedy's efforts to the contrary, that money was released to the Millers, and the fund Kennedy sought to place in the hands of a receiver no longer exists. The circumstances of this case have changed in that the appeal bond fund is not available, and it is, therefore, impossible for us to grant the relief Kennedy requested in his petition. Under these circumstances the issue is moot (Schnepper, 136 Ill. App. 3d at 681), and the appeal must be dismissed.

In his brief, Kennedy also asks us to reverse and remand this cause with instructions that the trial court appoint a receiver and "to order the Millers to deposit [a sum] with the receiver pending retrial." However, this is not the same as the relief originally requested by Kennedy, responded to by the Millers, and ruled upon by the trial court and will not be considered here.

Even if this case were not moot, Kennedy was not entitled to the relief he sought. While appointment of a receiver is within the discretion of the trial court (Leib v. Toulin, Inc. (1983), 113 Ill. App. 3d 707, 718, 447 N.E.2d 900), it is an extraordinary and drastic remedy which is in derogation of the fundamental rights of the owner to possession of his property (Citicorp Savings v. Occhipinti (1985), 136 Ill. App. 3d 835, 840, 483 N.E.2d 706). The power to appoint a receiver should be exercised only when the court is satisfied that receivership is necessary to circumvent the imminent danger of loss. (136 Ill. App. 3d at 840.) The facts that were before the trial court in this case did not warrant appointment of a receiver.

"The general rule is that the applicant must show, first, that he has a clear right to the property itself or has some lien upon it, or that the property constitutes a special fund to which he has a right to resort for the satisfaction of his claim; and second, that the possession of the property by the defendant was obtained by fraud, or that the property itself, or the income ...


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