Hay v. Bennett , 153 Ill. 271 ( 1894 )

Mr. Justice Baker

delivered the opinion of the court:

Appellant urges that his position was misunderstood by the Appellate Court, and he re-states his claim. His contention, in substance, is this: that the decree ordering the administrator of Judge Treat’s estate to pay $3500 to Charles W. Bennett was rendered in a suit to which all persons in interest were parties; that said amount was decreed to be the residue of the estate theretofore jointly owned by Sarah M. and Charles W. Bennett ; that the administrator paid said sum to Charles W. Bennett before the decree was reversed and before the writ of error was' issued, and that therefore such payment must be regarded as a credit upon any sum found due the complainants in the original bill, notwithstanding the fact that the decree was subsequently reversed and the theory of the original bill sustained.

Special attention is called by appellant to what this court said in Goudy v. Hall, 36 Ill. 313. The language there used and here quoted by appellant is this: “Society should be able to rely upon the judgments and decrees of its courts, and although it knows that they are liable to be reversed, yet it has a right, so long as they stand, to presume they have been properly rendered.” This language was used by the court in pointing out the difference, in case of a judicial sale, in the position occupied by third persons from that occupied by parties to the proceeding in which the sale was decreed. The word “society,” found in the quotation, is used as synonymous with third persons, or strangers to the decree. The ground of the decision in Goudy v. Hall was, that since the circuit court had jurisdiction of the persons in interest and subject matter, it was of no moment how erroneous the proceedings of the court may have been, the rights of third persons, acquired while such proceedings were unreversed, and by virtue of them, must be protected. (See the subsequent case of Wadhams et al. v. Gay, 73 Ill. 415, and the numerous authorities there cited.) It was there, in substance, said, that when a judgment or decree has been reversed, then, as between the parties to the litigation, they are all to be restored to their original rights, but that the rights of third persons are not affected ; and also that this principle is not confined to the case of judicial sales, but that it applies to judgments and decrees which simply declare and vest the legal right in the party claiming it.

The foundation stone of the distinction between the case of parties to the suit and the case of third parties is the element of notice. The law presumes that a party to the suit or proceeding has notice of every fact and step in the proceedings of the court, from their commencement until after their completion, and he is bound to know that all the proceedings are legal. Herman on Executions, p. 488, sec. 328.

It is claimed that the $3500 paid to Charles W. Bennett should be deducted from the trust fund decreed to be paid to appellees, and that if said sum of $3500 belongs to appellees, they should be required to look to the person to whom the trustee paid' it. And in that connection great reliance is • placed in the case of Kettleby v. Lamb, 2 Ch. Rep. 404, which was quoted and approved of by Lord Bedesdale in Bennett v. Hammill, 2 Scho. & Lef. 566. The case was that of a bill praying that a certain sum of money in the hands of trustees might be laid out for the benefit of the plaintiff. The bill was dismissed, and the decree of dismission signed and enrolled, after which the trustee paid the money to the other party, who had claimed it. On a bill of review that decree was reversed, yet the court determined that the trustees, in regard that they relied upon the dismission, signed and enrolled, were indemnified thereby, and that the plaintiff should be put to seek the money against the persons to whom the trustees had paid it, on the ground that the judgment, while it remained in force, bound the rights and justified the parties, though they paid it voluntarily and without suit.

There is a marked and controlling distinction between Kettleby v. Lamb and the case at bar. There the decree that was reversed was the result of a hearing before the chancellor, and was the act and voice of the chancellor, and embodied his judgment and adjudication upon the rights of the parties. Here the decree that was reversed was a decree that was entered by consent and agreement of parties, and without either a hearing before or adjudication by the court. (Bennett v. Bradford, 132 Ill. 269.) These infant appellees were incapable of consenting to the decree that deprived them of their property, and it would be highly inequitable and unjust to hold that their trustee and their father, both claiming interests that were hostile to theirs, could agree between themselves upon a decree and have it entered, whereby the trustee was relieved of all liability for $6500 of the trust fund, and the father was decreed the residue, $3500, which he was not entitled to have; and then, the subsequent act, based on the decree so entered, of the trustee paying the $3500 to the father, has the effect of relieving the trustee of liability to account to his infant cestuis que trust for the sum so paid.

The conclusions we have arrived at in respect to the general merits of this case are fully and well expressed in the opinion of the Appellate Court. We approve the views therein expressed, and adopt them as our own.

The judgment of the Appellate Court is affirmed.

Judgment affirmed.