CHRISTIAN W. KRONMEYER et al. Plaintiffs in Error, vs. WERDEN BUCK, Defendant in Error.

Opinion filed April 19, 1913-Rehearing denied June 5, 1913.

1. DURESS—when note is procured by duress. A note executed by a woman under the belief that her brother would be sent to jail if she did not immediately do so will be regarded as procured by duress, even though no promise of immunity was expressly made, where the circumstances were such as to induce her to believe that her brother would not be prosecuted if she signed the note but that he would be sent to jail if she did not.

2. SAME when duress is not available to avoid a deed. Where a deed is executed to secure an amount of money actually due from the grantor to the grantee as the result of transactions having a criminal aspect, a court of equity will not set aside such conveyances even though their execution was procured by threats of criminal prosecution.

3. SAME when a deed will be set aside as obtained by duress. A deed to property worth $5000, obtained by threatening to send the grantor to jail on a charge of embezzlement from his employer, will be set aside as obtained by fraud and duress where the evidence is doubtful whether the grantor owed his employer anything, or, at most, more than a mere trifling sum, although the employer and his attorney charged him with embezzling a large amount of money and claimed they had proof of that fact, which so wrought upon the fears of the employee, in his extremely nervous condition, that he executed the deed.

4. SAME what is necessary to sustain a compromise of doubtful claim. To sustain a compromise of a doubtful claim, where it later turns out that the promisee does not owe the claim, it is essential that the controversy shall be honestly inaugurated and that perfect fairness and good faith shall characterize the conduct of the party seeking to uphold the compromise agreement.

5. SAME when rule that deed will not be set aside for failure of consideration does not apply. The rule that an executed conveyance of real estate will not be set aside for failure of consideration does not prevent a court of equity from granting relief as between the parties to a deed, where the deed was obtained by fraud and duress and conveyed property worth $5000 to settle an alleged shortage in the grantor's accounts with the grantee, which, if it existed at all, was for a trifling amount.

WRIT OF ERROR to the Circuit Court of Will county; the Hon. CHARles B. CampbeLL, Judge, presiding.

J. W. D'ARCY, for plaintiffs in error.

J. L. O'DONNELL, T. F. DONOVAN, and J. A. BRAY, for defendant in error.

Mr. JUSTICE VICKERS delivered the opinion of the court: Christian W. Kronmeyer and Sophia M. Staehle, plaintiffs in error, filed their bill in chancery in the circuit court of Will county against Werden Buck to set aside a deed made by Kronmeyer to Buck, and also to compel Buck to refund the proceeds of a $1500 note given to the Will County National Bank, which said note was signed by both complainants. The prayer for relief was based on the charge that the instruments were fraudulently obtained through threats, coercion and duress and that they were without consideration. Defendant in error answered denying the allegations of the bill, to which a replication was filed, and the cause was heard upon evidence given in open court. The court below dismissed the bill for want of equity, and complainants have sued out a writ of error.

The evidence shows the following state of facts: Defendant in error, Buck, was engaged in the sale of building material, such as lime, cement, tile, sewer pipe, and also sold coal. Kronmeyer had been in the employ of Buck as salesman and general foreman in connection with his business for about ten years. His duties required him to be in and about the office and yards of the place of business. He was authorized to, and did, receive cash for merchandise sold, usually in small quantities, and carried a leather pouch in which the money was placed as it was taken in by him. The books were kept in the office, and when money was received or paid out by Kronmeyer it was his duty to make

an entry on the cash book in the office showing the transaction. These transactions were not always entered separately, but one entry would often cover several small transactions and would be entered as cash sales. Sacks were frequently returned and cash paid for them at the rate of ten cents each, and when Kronmeyer paid out cash for sacks or for other purposes it was his duty to make an entry on the book charging cash with the amount paid out. He owned a house in Lockport in which he resided with his wife and two children until January 5, 1911, when his wife died after a protracted illness. After the death of his wife the two children, being aged twelve and ten years, respectively, were sent to Chippewa Falls, Wisconsin, where he had a married daughter residing. He continued to reside in Lockport, occupying one of the rooms of his house with his furniture. After the death of his wife his health commenced declining. He lost between eighty and ninety pounds in weight during the two months following his wife's death. He became very nervous and was unable to sleep. He was under the treatment of physicians but was constantly growing worse. On March 18, 1911, he went to Chippewa Falls to visit his children. The evidence is uncontradicted that he was in a highly nervous condition, unable to sleep, and had an excited, unusual stare in his eyes. On March 22 he returned to Joliet and resumed his duties at Buck's place of business. There had never been difficulty of any character between Kronmeyer and Buck, and the former had no intimation that he did not enjoy the complete confidence and esteem of Buck. Coll McNaughton was the attorney and confidential adviser of Buck. His office was about six blocks from Buck's place of business. On the morning of March 23 Kronmeyer received a telephone call from McNaughton requesting him to come to McNaughton's office. He reported to his employer that he was wanted at McNaughton's office, and Buck directed him

to take his horse and go and see McNaughton. On his arrival at the office the door was closed and a conversation. took place, followed by the execution of the deed which is sought to be set aside in this proceeding. There is a disagreement between Kronmeyer on the one hand and McNaughton and Buck on the other as to what took place in the office. Kronmeyer testifies that when he arrived at the office McNaughton spoke to him in a harsh tone of voice and accused him of stealing from Buck, and, pointing toward the county jail, which stood nearby, said that he would be sent to jail unless the matter was adjusted. He also testifies that police officer Hennessey was outside the door; that within two or three minutes after Kronmeyer arrived at the office Buck entered and told Kronmeyer he had been robbing him for years, and accused him of having stolen $10,000 from him. Kronmeyer testifies that he denied having taken any money from his employer whatever; that he was excited and so frightened at the harsh methods of his accusers and the character of the accusation that he did not know what he was doing; that McNaughton and Buck demanded that he fix the matter up, and he told them he had no money with which to fix anything; that the conversation then turned to his property, and he told them of his Lockport residence and said it was worth $5000, subject to a $1500 mortgage; that McNaughton went out and was gone about thirty minutes to look up the title of the Lockport property, and when he returned he said that the title was all right and that Kronmeyer had told the truth about the encumbrance but said he had over-estimated its value, that it was not worth exceeding $3800. A deed was then prepared under the direction of McNaughton, conveying the property, together with a vacant lot in Lockport estimated to be worth from $800 to $1200, to Buck. After the deed had been signed and acknowledged Kronmeyer was asked what he was going to do about the $1500

mortgage on the property. He again said he had no money, and he was asked if he had any friends who would sign a note with him, to which he replied that he did not know; that he would see Mrs. Hill, a relative. A note for $1500 was then filled out by McNaughton and he and Kronmeyer drove away in a buggy to see Mrs. Hill, but Mrs. Hill declined to sign the note. They then drove to Mrs. Staehle's place, who is a sister of Kronmeyer. The evidence is not seriously in conflict as to what took place at Mrs. Staehle's. Kronmeyer took the note and went to the store where Mrs. Staehle was found and walked up to her and said, “Sign this note; Buck accuses me of stealing from him, and if I don't get this note signed I will have to go to jail." He was very much excited and Mrs. Staehle thereupon signed the note. McNaughton remained in front of the place, in the buggy. After the note was brought back with Mrs. Staehle's name to it, McNaughton took the note and called Mrs. Staehle and asked her if that was her signature, and she said it was. The two men then drove to the Will County National Bank, where the note was presented for discount. The bank objected to the note because it was not written on one of its forms. A new note was thereupon filled out at the bank for $1500 on the usual bank form and McNaughton and Kronmeyer again returned to Mrs. Staehle's place and she signed this note and the former one was destroyed. McNaughton and Kronmeyer again visited the Will County National Bank, where the note was cashed. The proceeds, being $1477, were taken back to McNaughton's office and there turned over to Buck, who executed some sort of a writing purporting to be an assumption of the encumbrance upon the Lockport property. McNaughton and Buck give a somewhat different version of the conversation that took place in the office. McNaughton testifies that when he first accused Kronmeyer of embezzling his employer's funds he denied it, and he and