Anthony Seeberger v. McCormick

This was an action brought in a state court of Illinois in which Leander J. McCormick sought to hold Seeberger and others as partners for an alleged false assumption of power as a national banking association.

On January 31, 1893, articles of association were signed, and an organization certificate was signed and acknowledged by nine citizens of Illinois, and both were transmitted to the Comptroller of Currency, as required by the Revised Statutes of the United States, for the purpose of making them a national banking association at Chicago by the name of the Market National Bank. At a meeting of the directors of the bank, chosen by the stockholders, and named in the articles of association, a president and cashier were duly elected, and the directors caused a seal to be made for the bank. On February 9, 1893, the president, pursuant to a resolution of the directors, signed and sealed with the corporate seal a lease in writing from Leander J. McCormick to the bank of certain offices in Chicago, 'to be used and occupied by said Market National Bank as a banking office, and for no other purpose,' for the term of five years from May 1, 1893, at a yearly rent of $13,000. By an agreement made part of the lease, McCormick was to make certain alterations and repairs at his own expense; either party might cancel the lease on May 1 of any year by giving ninety days' notice in writing; and no rent was to be charged until the bank took possession. On April 12, 1893, the parties made a supplemental agreement by which McCormick was to make further alterations, the bank paying half the cost thereof. All the alterations and repairs were made by McCormick as agreed; the cost, paid by him, of the alterations of April 12, 1893, being $2,475. On June 22, 1893, the president and cashier, in the name of the bank, took possession of the demised premises, and put in the fixtures and furniture, blank books and stationery, necessary to carry on a banking business, and they were not removed until April 30, 1895.

Of the whole capital stock of $1,000,000, called for in the articles of association, but $331,594, was ever paid in; and the bank was never authorized by the Comptroller of the Currency to commence, and never did commence, the business of banking. The officers of the bank, from time to time, corresponded with McCormick, using letter heads, with the name, location, and place of business of the bank and the names of the officers printed thereon, and signing in their official capacity. On August 15, 1893, the officers of the bank informed McCormick that the bank had never been authorized to commence the business of banking, and had no power to enter into the lease, and had abandoned all further proceedings, and offered to surrender the lease. McCormick refused to accept the surrender, and on September 20, 1893, the president caused the key of the office to be left on the desk of McCormick's agent, he refusing to accept it.

On October 4, 1893, the parties agreed in writing that, without prejudice to the rights of either, McCormick should take possession of the premises, and endeavor to lease them and to collect the rent thereof. He made every effort to obtain a tenant accordingly, but was unable to do so. On January 3, 1895, McCormick gave written notice to the president of the bank of his intention to terminate the lease in May, 1895, in accordance with its terms. The cashier paid the rent, according to the lease, until July 22, 1893; but the bank refused to pay any rent subsequently accruing, and never paid its half of the cost of the alterations made under the agreement of April 12, 1893. Thereupon McCormick brought an action against the Market National Bank on July 17, 1895, in the superior court of Cook county, Illinois, claiming that he was entitled to recover judgment, at the rate agreed upon in the lease, from July 22, 1893, up to May 1, 1895, and for half of the cost of changing and repairing the premises. That court refused to hold that McCormick could recover upon the lease as a valid contract, but gave judgment in his favor for the rent from July 22 to August 15, 1893, and for half the cost of the alterations, with interest, amounting in all to the sum of $2,548.85. This judgment was affirmed on successive appeals of McCormick, by the appellate court and by the supreme court of Illinois. 61 Ill. App. 33; 162 Ill. 100. Thereupon McCormick sued out a writ of error and brought the case to the Supreme Court of the United States, where the judgment of the Illinois courts was affirmed. 165 U.S. 538, 41 L. ed. 817, 17 Sup. Ct. Rep. 433.

On November 19, 1895, McCormick brought an action in the supreme court of Cook county, Illinois, against Anthony F. Seeberger and fifteen persons, as copartners doing business in Chicago, Illinois, under the firm name and style of the Market National Bank of Chicago. The defendants were officers, directors, and shareholders of the Market National Bank, and in this action McCormick sought to hold them personally for the balance of the rent due under the terms of the lease. The superior court rendered judgment for the defendants. McCormick appealed, and the appellate court of Illinois reversed the judgment, 'found the facts as set forth in the stipulation in the record,' and entered judgment against the defendants, and assessed the damages at the amount of the rent stipulated in the lease from August 15, 1893, to May 1, 1895, to wit, $22,208.33. The defendants then took the case to the supreme court of Illinois, which affirmed the judgment of the appellate court. Thereupon the defendants sued out a writ of error and brought the case to this court; and on October 16, 1899, a motion was made and submitted by the defendant in error to dismiss the writ of error on the alleged ground that no Federal question, sufficient to give this court jurisdiction to review the decision of the state court, was shown by the record.

Mr. Hiram T. Gilbert for plaintiffs in error.

Messrs. A. M. Pence, George A. Carpenter, and Shirley T. High for defendant in error.

Mr. Justice Shiras delivered the opinion of the court: