Union Mutual Life Insurance Company v. Kirchoff (169 U.S. 103)
This was a bill filed by Elizabeth Kirchoff in the circuit court of Cook county, Ill., against the Union Mutual Life Insurance Company, to compel a conveyance of two certain lots, in accordance with an agreement between the company and herself, on payment of the amount due thereunder, as p ovided for. The circuit court dismissed the bill on hearing, and the cause, after an ineffectual appeal directly to the state supreme court (128 Ill. 199, 20 N. E. 808), was carried to the appellate court, which reversed the decree of the circuit court, and remanded the cause, with directions that an account be taken, and that, when the amount due the company was ascertained, a decree be entered that on payment of such amount, with interest, the company should convey to Mrs. Kirchoff. 33 Ill. App. 607. From this judgment the insurance company prosecuted an appeal to the supreme court, and the judgment was affirmed. 133 Ill. 368, 27 N. E. 91. To review this judgment a writ of error was sued out from this court, but was dismissed, on the ground that the judgment of the supreme court was not final. 160 U.S. 374, 16 Sup. Ct. 318.

The case had, in the meantime, gone back to the circuit court, an accounting had been had, and a decree had been entered settling the accounts between the parties, and ordering the insurance company to convey the property in question on payment of the amount found due. From this decree the insurance company appealed to the appellate court, the decree of the circuit court was affirmed (51 Ill. App. 67), and this second judgment of the appellate court was affirmed by the supreme court (149 Ill. 536, 36 N. E. 1031). To review the latter judgment the insurance company prosecutes this writ of error.

The facts as found by the state courts were substantially these: In May, 1871, the Union Mutual Life Insurance Company loaned $60,000 to Elizabeth Kirchoff, her husband, Julius Kirchoff, and her mother, Angela Diversey, upon their judgment note, secured by trust deed, conveying many parcels of land belonging to them in severalty, among which were the lots in question, which lots belonged to Elizabeth Kirchoff. Default having been made in the payment of interest and taxes, judgment was taken against Mrs. Diversey, and later a bill was filed by the insurance company in the circuit court of the United States to foreclose the trust deed. The bill, in addition, sought to cure a misdescription of the property belonging to Mrs. Diversey, who filed an answer denying the right of the company to correct the misdescription, and averring that the note and mortgage were procured from her by misrepresentation. While this bill was pending an agreement was reached by the parties, pursuant to which the company released to Mrs. Diversey its claim upon 40 acres of the land belonging to her, and she executed to them a warranty deed for the remainder, while Mrs. Kirchoff and her husband executed a quitclaim deed of all the property belonging to them and included in the trust deed, it being agreed as part of the transaction that Mrs. Kirchoff might purchase from the company the two lots above named for $10,000, $1,000 in cash, and $9,000 in annual payments, for which Mrs. Kirchoff was execute her notes, extending over a period of nine years, bearing interest at 6 per cent., and secured by mortgage upon the two lots. But as there was an intervening claim on one of the lots growing out of a sheriff's deed in pursuance of a sale on a judgment against Mrs. Kirchoff, rendered subsequently to the original trust deed but prior to the deed from Kirchoff and wife to the company, it was agreed that the foreclosure proceedings should continue to be prosecuted; that as soon as the company got a deed from the master it would convey to Mrs. Kirchoff, and take the mortgage from her, and the company would thus and convey clear title, and the mortgage back would be a first lien.

No defense was made to the foreclosure, the case went to decree and sale, and a master's deed was issued to the insurance company.

During the prosecution of the foreclosure proceedings a receiver had been appointed of all the property, and about nine months after the confirmation of the report of sale the receiver filed a petition, stating that Julius Kirchoff was in possession of the premises, and refused to pay rent therefor, and asking for a writ of assistance to put the receiver in possession, to which Julius Kirchoff filed an answer setting up the agreement, and objecting to the issue of the writ lest his rights be prejudiced; but the writ was nevertheless issued.

It appeared on the second hearing that prior to September 10, 1884, the United States had seized the property for certain revenue taxes due from a firm then occupying it as a distillery, Mrs. Kirchoff being in no way connected with the firm; that the property was sold, the government bidding it in and taking a deed for it; and that the government conveyed to the insurance company. In the account stated Mrs. Kirchoff was required to repay the amount the insurance company paid the government, with interest. The supreme court of Illinois held, on the second appeal, on the authority of Mansfield v. Refining Co., 135 U.S. 326, 10 Sup. Ct. 825, that the United States took no title by its deed as against Mrs. Kirchoff; and, further, that the insurance company could not set up any right under the deed from the government, because of its acquisition long prior to the submission of the case upon the first appeal. No question was raised in this court in respect of this transaction.

E. Parmalee Prentice, for plaintiff in error.

W. S. Harbert, for defendant in error.

Mr. Chief Justice FULLER, after stating the facts in the foregoing language, delivered the opinion of the court. 

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