{ "id": 5140467, "name": "United Mail Order, Warehouse & Retail Employees Union, Local 20, Affiliated with United Retail, Wholesale and Department Store Employees of America, C.I.O., an Unincorporated Association; (and) Samuel Wolchok et al., Individually and as Members of Said Unincorporated Association, Appellees, v. Montgomery Ward & Co., Incorporated, Appellant", "name_abbreviation": "United Mail Order, Warehouse & Retail Employees Union, Local 20 v. Montgomery Ward & Co.", "decision_date": "1955-06-13", "docket_number": "Gen. No. 46,433", "first_page": "477", "last_page": "489", "citations": [ { "type": "official", "cite": "6 Ill. App. 2d 477" } ], "court": { "name_abbreviation": "Ill. App. Ct.", "id": 8837, "name": "Illinois Appellate Court" }, "jurisdiction": { "id": 29, "name_long": "Illinois", "name": "Ill." }, "cites_to": [ { "cite": "63 Ill. App. 652", "category": "reporters:state", "reporter": "Ill. App.", "case_ids": [ 5167507 ], "opinion_index": 0, "case_paths": [ "/ill-app/63/0652-01" ] }, { "cite": "144 Ill. 14", "category": "reporters:state", "reporter": "Ill.", "case_ids": [ 3078512 ], "opinion_index": 0, "case_paths": [ "/ill/144/0014-01" ] }, { "cite": "71 Pa. 442", "category": "reporters:state", "reporter": "Pa.", "case_ids": [ 1031238 ], "opinion_index": 0, "case_paths": [ "/pa/71/0442-01" ] }, { "cite": "325 U. 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App.", "case_ids": [ 2485088 ], "opinion_index": 0, "case_paths": [ "/ill-app/131/0387-01" ] }, { "cite": "54 Ill. 153", "category": "reporters:state", "reporter": "Ill.", "case_ids": [ 5275991 ], "opinion_index": 0, "case_paths": [ "/ill/54/0153-01" ] }, { "cite": "372 Ill. 386", "category": "reporters:state", "reporter": "Ill.", "case_ids": [ 2527637 ], "opinion_index": 0, "case_paths": [ "/ill/372/0386-01" ] }, { "cite": "371 Ill. 570", "category": "reporters:state", "reporter": "Ill.", "case_ids": [ 2521318 ], "opinion_index": 0, "case_paths": [ "/ill/371/0570-01" ] }, { "cite": "228 Ill. App. 153", "category": "reporters:state", "reporter": "Ill. App.", "case_ids": [ 3068557 ], "opinion_index": 0, "case_paths": [ "/ill-app/228/0153-01" ] }, { "cite": "18 Ill. App. 281", "category": "reporters:state", "reporter": "Ill. App.", "case_ids": [ 865069 ], "opinion_index": 0, "case_paths": [ "/ill-app/18/0281-01" ] }, { "cite": "348 Ill. App. 198", "category": "reporters:state", "reporter": "Ill. App.", "case_ids": [ 5097626 ], "opinion_index": 0, "case_paths": [ "/ill-app/348/0198-01" ] }, { "cite": "400 Ill. 38", "category": "reporters:state", "reporter": "Ill.", "case_ids": [ 5306160 ], "opinion_index": 0, "case_paths": [ "/ill/400/0038-01" ] }, { "cite": "330 Ill. App. 49", "category": "reporters:state", "reporter": "Ill. App.", "case_ids": [ 3410744 ], "opinion_index": 0, "case_paths": [ "/ill-app/330/0049-01" ] } ], "analysis": { "cardinality": 898, "char_count": 21675, "ocr_confidence": 0.52, "pagerank": { "raw": 1.230403588828474e-07, "percentile": 0.6055076956224089 }, "sha256": "d801e07ef687bb8772cc969c3de84058e5a916a6e5de968abeca8c75bcb02602", "simhash": "1:9f1f42e77e798ca3", "word_count": 3706 }, "last_updated": "2023-07-14T20:47:48.451913+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "United Mail Order, Warehouse & Retail Employees Union, Local 20, Affiliated with United Retail, Wholesale and Department Store Employees of America, C.I.O., an Unincorporated Association; (and) Samuel Wolchok et al., Individually and as Members of Said Unincorporated Association, Appellees, v. Montgomery Ward & Co., Incorporated, Appellant." ], "opinions": [ { "text": "MB. JUSTICE FBIEND\ndelivered the opinion of the conrt.\nMontgomery Ward and Company, incorporated, hereinafter referred to as Ward\u2019s, appeals from an adverse judgment in the sum of $327,000, entered in the municipal conrt of Chicago in a first-class suit in contract, predicated on a $1,000 injunction bond filed by Ward\u2019s in tbe superior court of Cook county in a proceeding initiated in 1943.\nTbe original complaint filed by Ward\u2019s on November 9, 1943 alleged tbat plaintiffs (who were defendants in tbat proceeding and will hereinafter be referred to as tbe union) bad conspired to libel and vilify Ward\u2019s for tbe purpose of injuring its business and reputation. Tbe complaint prayed for a temporary and permanent injunction against continued publication of libelous statements, and asked for monetary damages in tbe amount of $1,000,000 for past libels. Tbe union filed a motion to strike Ward\u2019s complaint and dismiss tbe suit, whereupon Ward\u2019s moved for a preliminary injunction. Both motions were fully argued and briefed, and thereafter, on June 25,1945, the chancellor entered an order denying tbe union\u2019s motion to dismiss tbe action. On tbe same day be granted Ward\u2019s motion for a preliminary injunction, to be effective upon tbe approval of an injunction bond, and to remain in effect until further order of court. Tbe temporary injunction prohibited tbe union and designated union members from conspiring together or acting in concert to publish untrue statements concerning Ward\u2019s for tbe purpose of causing its employees and customers to fear, dislike or distrust Ward\u2019s, its officers or supervisory employees. On tbe following day, June 26, 1945, tbe injunction bond sued upon in this proceeding, in tbe amount of $1,000, was filed and approved.\nSome ten days later, on July 6, 1945, tbe union filed a motion to vacate and set aside tbe order of June 25, 1945 which denied its motion to dismiss, and which granted Ward\u2019s motion for a preliminary injunction. Tbe court denied tbe union\u2019s motion, and since it refused to plead further and stated orally tbat it would stand on its motion to strike tbe complaint and dismiss tbe suit, tbe court on tbat day entered an order which reads in part as follows: . . tbe above-named defendants having elected to stand on their Motion to Strike the complaint and to dismiss the suit, therefore the Order of June 25,1945 is made a final order.\u201d The union appealed from the order of June 25,1945 and the final order of July 6, 1945, and on November 20, 1946 the third division of this court, in Montgomery Ward & Co., Inc. v. United Retail, Wholesale & Department Store Employees of America, C.I.O., 330 Ill. App. 49, reversed the decrees of June 25, 1945 and July 6, 1945 and remanded the cause \u201cwith directions to dismiss the complaint for want of equity.\u201d Ward\u2019s then appealed to the Supreme Court of Illinois, which on March 18,1948 affirmed the judgment of the Appellate Court (Montgomery Ward & Co., Inc. v. United Retail, Wholesale & Department Store Employees of America, C.I.O., 400 Ill. 38).\nJune 1, 1948 the union filed in the superior court of Cook county a suggestion of damages under section 12 of the Injunction Act (Ill. Rev. Stat. 1953, ch. 69 [Jones Ill. Stats. Ann. 109.360]), claiming damages of $457,750 for organizational expenses, loss of union dues, attorneys\u2019 fees and court costs allegedly incurred by reason of the temporary injunction and Ward\u2019s claim for $1,000,000 damages. Ward\u2019s on June 4, 1948 filed a motion to strike and dismiss the suggestion of damages upon the grounds, among\u2019 others, that the temporary injunction had not been dissolved but had merged in the final order and become functus officio, and that the alleged damages did not arise by reason of the injunction. On June 7, 1948 the union filed a motion to dissolve the temporary injunction. Both motions were fully argued, and on June 22, 1948 the superior court entered an order dismissing the union\u2019s suggestion of damages and denying the union\u2019s motion to dissolve the temporary injunction on the ground, as stated by the court orally, that the temporary injunction entered as part of the order of June 25, 1945, merged in the final order of July 6, 1945, and as such became functus officio. No appeal was taken from that order.\nSome two years later, April 25,1950, the union filed, in the superior court, a second petition for damages which it claimed to have suffered by reason of the alleged wrongful issuance of the injunction. The items of damage claimed were similar to those alleged in the first petition filed in 1948, although the amount was increased from $457,750 to $730,000. The petition also contained additional allegations pertaining to the filing and existence of a $1,000 injunction bond. On May 15, 1950 Ward\u2019s filed a motion to strike and dismiss the union\u2019s second petition upon the same grounds as previously urged in its motion to dismiss the first petition, and for the additional reason that the order of June 22, 1948 was a final order which had previously adjudicated all the matters presented in the second petition. Pursuant to hearing, the court, on November 24, 1950, entered an order dismissing the union\u2019s petition. The union appealed from this order, and on November 14, 1952, in Montgomery Ward & Co., Inc. v. United Retail, Wholesale & Department Store Employees of America, C.I.O., 348 Ill. App. 198, the second division of this court affirmed the trial court\u2019s order of dismissal. The union then petitioned for leave to appeal to the Supreme Court of Illinois which was denied on March 11, 1953 (351 Ill. App. xiv).\nNeither the Appellate nor Supreme Court considered or decided whether the temporary injunction was rightfully or wrongfully issued. In the case of temporary injunctions the statute provides a method of appeal, and this is the only way in which such an order can be set aside (Ill. Rev. Stat. 1953, Civil Practice Act, ch. 110, par. 202, sec. 78 [Jones Ill. Stats. Ann. 104.078]). Both courts had before them for review the final order of July 6, 1945, and they passed only upon the sufficiency of the complaint and held in effect with the union\u2019s contention that the complaint was utterly insufficient and that the granting of injunctive relief from the publishing of defamatory matters violated two general principles, namely, (1) that equity does not have jurisdiction to enjoin the commission of crime and libels, and (2) that the constitutional guarantee of free speech as a general rule prohibits courts from enjoining actual or threatened publications such as were alleged in Ward\u2019s complaint.\nOn the second appeal to this court it was held that the union\u2019s claim for damages under section 12 of the Injunction Act had already been adjudicated. However, this section provides that \u201ca failure so to assess damages shall not operate as a bar to an action upon the injunction bond.\u201d Accordingly the union still had available the right to bring an action at law on the bond. This is strictly a legal action to. enforce a legal right. Lovejoy v. Stelle, 18 Ill. App. 281; Warner v. Wende, 228 Ill. App. 153. The items of damages claimed in the instant suit were the same as those alleged in the petitions filed in the superior court in 1948 and 1950, and the amount claimed for each item of damage was substantially the same as the amount claimed in the second petition filed in the superior court, but, in addition to these previously claimed items, the union asked for $70,000 to cover its attorneys\u2019 fees and court costs incurred in prosecuting the two claims for injunction damages in the superior court and for prosecuting the present case. Ward\u2019s filed a motion to strike and dismiss the union\u2019s statement of claim which was denied, whereupon Ward\u2019s answered. Hearing by the court resulted in the judgment entered February 23, 1954 for $327,000 in favor of the union, from which Ward\u2019s appeals.\nThe obligation of the bond is to pay $1,000 upon condition that the obligation shall be void if Ward\u2019s pays to the union the damages which it may sustain by reason of the wrongful issuing of the temporary injunction and such damages as shall be awarded against Ward\u2019s in case the temporary injunction is dissolved. Ward\u2019s contends that the union cannot recover on the bond because its condition was not breached since the temporary injunction was not wrongfully issued or dissolved. This question was not before either of the courts of appeal and was not decided; but since the first opinion of this court and that of the Supreme Court both hold conclusively that Ward\u2019s complaint was inherently defective and did not support the injunctive relief sought upon constitutional and jurisdictional grounds, it would be naive to hold that the temporary injunction was rightfully issued. We are not unmindful of the rule that an interlocutory injunction is merely provisional and does not conclude a right, its effect and purpose being to keep matters in status quo until a final hearing, and that an applicant for an interlocutory injunction is not required to make out a case which will entitle him, at all events, to relief at the hearing, but it is enough if he raises a fair question as to the existence of the right which he claims and can satisfy the court that matters should be preserved until such questions can be disposed of. Nestor Johnson Mfg. Co. v. Goldblatt, 371 Ill. 570, and Schuler v. Wolf, 372 Ill. 386. However, in the Nestor Johnson case a full hearing on the merits before a master followed the issuance of the temporary injunction, at the conclusion of which the master recommended that the claim for a permanent injunction be disallowed and that the bill be dismissed for want of equity. In the present case the complaint was defective on its face and did not warrant a trial upon the merits; the relief sought was a temporary and permanent injunction. Neither of these remedies was properly available to Ward\u2019s, and the Appellate and Supreme Court so decided. In Schuler v. Wolf it was held that whether or not a temporary injunction was properly or wrongfully issued or dissolved is not dependent upon the ultimate settling of the issues, and the fact that a permanent injunction was finally issued on the merits of the cause did not determine that an order dissolving a temporary injunction was erroneous. In both, of these cases the propriety of issuing a temporary injunction was resolved upon a hearing on the merits; in neither case was there a question as to the insufficiency of the complaint to support the relief sought. Accordingly we hold that the union had a legal right to sue on the bond.\nThis raises two questions: (1) the nature and extent of damages claimed by the union, and (2) the propriety or impropriety of limiting the union\u2019s recovery to $1,000, the penal sum named in the bond. With respect to the first of these questions, the municipal court took evidence on the several items of damages claimed by the union for a period of approximately three years following the issuance of the temporary injunction on June 25,1945. It is clear, however, that the temporary injunction was effective only from June 25, 1945 to July 6, 1945, when it became functus officio by reason of the final order. Accordingly the union would be entitled to damages only for that eleven-day period.\nCan the nnion, in any event, recover more than $1,000, the penal sum named in the bond? This being a contract action, Ward\u2019s liability is limited to its doing what it covenanted to do. This is an elementary principle of contract law. The only covenant of the contract is that Ward\u2019s and its surety \u201care held and firmly bound unto\u201d the union \u201cin the sum of One Thousand and no/100ths Dollars ($1000.00) to be paid\u201d the union \u201cfor which payment well and truly to be made, we bind ourselves, jointly and severally.\u201d Following the recital of this obligation to pay $1,000 is the statement of the condition that the obligation to pay $1,000 shall be void \u201cif\u201d Ward\u2019s pays to the union the damages which it may sustain by reason of the wrongful issuing of the temporary injunction and such damages as shall be awarded against Ward\u2019s in case the temporary injunction is dissolved. The only language concerning the payment of damages preceded by the conditional word \u201cif\u201d merely sets the condition by which it is to be determined whether the covenant to pay $1,000 is to be effective or void; there is no unconditional promise by Ward\u2019s to pay the damages which may be sustained by the union. Under Illinois decisions the stated penalty of a bond fixes the limit of recovery in an action on the bond as against both the principal and surety, regardless of the amount of damages which the obligee may have sustained. In the early case of Freeman v. People (1870), 54 Ill. 153, the trial court entered judgment for more than the $500 face amount of a bastardy bond. The Supreme Court, in reviewing the judgment, said that \u201cthe obligors can in no event be held liable on this bond for more than the penalty. That is the extent of their undertaking. The obligee can not recover damages beyond that sum, whatever be the amount of damages sustained.\u201d In Kerz v. Wolf (1907), 131 Ill. App. 387, suit was brought on an injunction bond in the face amount of $500. The trial court instructed the jury to find the issues for the plaintiffs, and to \u201cassess the plaintiffs\u2019 damages at such sum, not exceeding $500.00.\u201d The Appellate Court approved these instructions, saying: \u201cThese instructions stated correct legal principles to guide the jury in their admeasurement of damages . . . The value of the legal services rendered in procuring a dissolution of the injunction in question was $750.00 . . . ; therefore, whether the appearance and stenographer\u2019s fees testified about and set down in the bill of particulars, were proper charges, become immaterial in view of the verdict of $500.00, the limit of a possible recovery in an action on the bond . . .\u201d Text writers on the subject of damages and injunction state the same rule. Sutherland on Damages (1916), 4th ed., vol. 2, par. 478, p. 1567, comments on this type of bond as follows: \u201cThe condition of a penal bond not being an affirmative undertaking, but only at law an optional defeasance of the bond, the penalty fixes the extent of liability in case the condition is not performed.\u201d (Emphasis ours.) \u201cIt is fully settled . . . , that in an action on a bond no damages in gross can be recovered, against either principal or surety, beyond the amount of the bond.\u201d Sedgwick on Damages (1912), 9th ed., vol. 2, par. 677, p. 1386.\nThe union argues that the obligee in a penal bond has an option to bring either an action of debt for the amount of the penalty named in the bond, or an action of covenant for the damages which the obligor has contracted to pay, and that where the obligee brings an action of covenant for damages he is not limited by the stated penalty of the bond. Various decisions are cited to support this contention. However, this would be true only if there was a covenant upon which to base the action. The only covenant or promise of the bond in suit is to pay $1,000, subject to a condition of defeasance ; there is no covenant or promise to pay any damages beyond the sum of $1,000. As we view it, the fallacy of the union\u2019s argument is in treating the condition of the bond as though it were a covenant. Emphasis is laid by the union on Lowe v. Peers (1768), 4 Burrows (K. B.) 2225, which was an action upon the following marriage contract executed by one Peers: \u201cI do hereby promise Mrs.' Catherine Lowe, that I will not marry with any person besides herself; if I do, I agree to pay to the said Catherine Lowe $1000 within three months next after I shall marry any body else.\u201d Ten years after the contract was executed, Peers married another woman. The. question involved was not whether plaintiff in the suit on the bond could recover from the principal the actual damages suffered or whether the liability of the principal would be limited to the penalty of the bond, but whether the plaintiff could recover the penalty provided in the contract without proving actual damages in that amount. It thus appears that this case did not involve a recovery for a sum greater than the penalty, and it should be noted that Lord i|ansfield was careful to point out that \u201cwhere the covenant is \u2018to pay a particular liquidated sum,\u2019 a court of equity cannot make a new covenant for a man; nor is there any room for compensation or relief.\u201d\nThe union cites Martin v. Taylor (1803), Fed. Cas. No. 9166, and Lawrence v. United States (1841), Fed. Cas. No. 8145, as leading federal cases on the question. The Martin case involved an express covenant to do certain acts in connection with the transfer of land, and this covenant was secured by a penalty. In the Lawrence case the court reversed the judgment in excess of the stated penalty of a bond which had been given to secure the faithful performance of the office of a deputy postmaster, citing Lord Mansfield\u2019s Lowe v. Peers, with the observation that \u201cthis point seems not to have been involved in that case; and it must be regarded, rather as a dictum by his lordship, than a solemn decision.\u201d The federal rule that recovery on an injunction bond is limited to the stated penalty of the bond seems to be well established. In United States v. Lewis Pub. Co. (1908), 160 Fed. 989, which involved an injunction bond, the court said that \u201cif a bond is required to be given, its penal sum is the maximum risk assumed,\u201d and in the more recent injunction bond case of International Ladies\u2019 Garment Workers\u2019 Union v. Donnelly Garment Co. (1945), 147 F.2d 246, cert. den. 325 U. S. 852, the court said that \u201cthe weight of authority in the federal courts is that a recovery in excess of the maximum amount stipulated in a judicial bond is not permissible.\u201d\nThe union further cites New Holland Turnpike Co. v. Lancaster County (1872), 71 Pa. 442, and other Pennsylvania cases. All these cases involved bonds in which the obligor expressly covenanted to do a particular thing, which covenant was secured by a penalty. None of the cases involved a common defeasance bond of the type in suit here, and it should be noted that the Pennsylvania court was careful to make this distinction in the New Holland Turnpike Co. case: \u201cIt is not a mere bond in a penalty \u2014 on a condition to be void upon the doing or not doing a collateral act, either by the obligor or a third party. ... In such cases it may be conceded that the penalty of the bond is the limit of liability on the instrument itself . . .\u201d\nThe Illinois decision upon which the union chiefly relies as controlling is Kohlsaat v. Crate, 144 Ill. 14. This was not an action on an injunction bond, and the question of the extent of the obligor\u2019s liability on the bond was not before the court and was not considered; it involved, rather, a statutory proceeding in the equity court to recover injunction damages under section 12 of the Injunction Act, and all the court held was that the statutory proceeding was independent of the bond and that the provisions of the bond did not control and had no bearing on the amount which might be recovered in a proceeding under the statute. It is unfortunate for the union that it did not pursue its statutory remedy to appeal from the wrongful issuance of the temporary injunction and to claim damages under the procedure prescribed by the statute, but the present case is an action brought on the bond itself, and under the authorities as we view them the union is limited by the express provisions of the bond.\nThe remaining point urged as ground for reversal is that the union as an unincorporated association is without legal capacity to sue in its own name. Plaintiffs in this proceeding are fifteen individuals and the United Mail Order, Warehouse and Eetail Employees Union, Local 20, an' unincorporated association (in this opinion both the union and the individuals have been referred to as the union). It is argued that under the common-law rule an unincorporated association has no legal entity distinct from its members and can neither sue nor be sued at law in its association name. Various decisions, including O\u2019Connell v. Lamb (1895), 63 Ill. App. 652, are cited. In the O\u2019Connell case the labor union was named obligee in a surety bond issued for the treasurer of the union. That official defaulted, and several members of the union sued on the bond for the benefit of all the members. The trial court sustained a demurrer to the complaint, which was affirmed by the Appellate Court, holding.that suit can be maintained only in the names of all the members, however numerous. We concur in this rule of law.\nFor the reasons indicated we have concluded that the judgment of the municipal court should be reversed and the cause remanded with directions to proceed in accordance with the views herein expressed; it is so ordered.\nJudgment reversed and cause remanded with directions.\nBURKE, P. J. and NIEMEYER, J., concur.", "type": "majority", "author": "MB. JUSTICE FBIEND" } ], "attorneys": [ "John. A. Barr, David L. Dickson, and Charles J. Barnhill, all of Chicago, for appellant.", "Urban A. Lavery, Francis Heisler, and Pearl Baer, all of Chicago, for appellees." ], "corrections": "", "head_matter": "United Mail Order, Warehouse & Retail Employees Union, Local 20, Affiliated with United Retail, Wholesale and Department Store Employees of America, C.I.O., an Unincorporated Association; (and) Samuel Wolchok et al., Individually and as Members of Said Unincorporated Association, Appellees, v. Montgomery Ward & Co., Incorporated, Appellant.\nGen. No. 46,433.\nFirst District, First Division.\nJune 13, 1955.\nReleased for publication September 15, 1955.\nJohn. A. Barr, David L. Dickson, and Charles J. Barnhill, all of Chicago, for appellant.\nUrban A. Lavery, Francis Heisler, and Pearl Baer, all of Chicago, for appellees." }, "file_name": "0477-01", "first_page_order": 491, "last_page_order": 503 }