delivered the opinion of the court:
The chief contention of appellant is, that the resolution set out in the statement, authorizing the execution and delivery of the trust deed and bonds in question, did not authorize the sale of the one hundred bonds involved in this foreclosure. Clearly, in the former case of Unity Co. v. •Hquitable Trust Co. supra, this court held that the said one hundred bonds were properly in the hands of Gov. Altgeld, as president of the Unity Company, to be sold. The word “execute” frequently includes delivery. (Hunt v. Weir, 29 Ill. 83.) The word “delivery” is sometimes used meaning the change of possession of property but frequently as meaning the change of title. (Robinson & Co. v. Berkey & Martin, 111 Iowa, 550.) Manifestly, the word “sell” is included, by implication, in the words “execute and deliver” as they are used in this resolution. We concluded in the former case that these bonds were held by Gov. Alt-geld, as president of the company, for sale, and all the evidence in this case tends to support this conclusion. But, regardless of other evidence, we think the resolution plainly authorized the president and secretary to sell the one hundred bonds here in question and use the proceeds to pay off indebtedness. The evidence in the former foreclosure proceeding, as in this, show's that when the $100,000 of bonds issued under the first trust deed were canceled, Gov. Altgeld, in order to save the enterprise from ruin, was obliged to raise this extra $100,000, which he did mostly by short-time paper; that after carrying the loan for several years (which in the latter part of 1894 was especially difficult to do) this resolution was passed for the purpose of raising $100,000 to take care of this indebtedness; that the officers failed to make a -sale of the $100,000 of extra bonds, as they anticipated, to the Equitable Trust Company, and that therefore it was thought advisable to dispose of the bonds as indicated heretofore in the statement of the case.
The Unity Company by its answer admits the making of the second trust deed and the execution of the four hundred bonds pursuant to the authority of this resolution and the deposit of the three hundred bonds with the trustee to exchange for the former bonds issued, but denies that the remaining one hundred bonds were issued or disposed of for value. Later on, after the evidence was all taken, the Unity Company obtained leave to file an amendment to its answer without prejudice to the proceedings already taken, and .in that amendment alleged that the said one hundred second mortgage bonds were issued and disposed of wrongfully by the officers of the company, without authority or right from the Unity Company, and were disposed of for the purpose of procuring credit to said officers as individuals and for a purpose which was ultra vires and beyond the charter power of the company. As we understand the argument of counsel, they insist that by this answer, and also by the amended answer, the burden of showing that the officers were authorized to sell, as well as execute and deliver, these bonds, rested upon appellees, and also the burden of showing that the proceeds from the sale of said bonds were used in behalf of said appellant. The authorities cited by appellant on this question are all common law actions, where the verified plea of non est factum raised the question of execution and deliver)'-, and we know of no statute by which a verified denial of execution and delivery requires the complainant in a foreclosure proceeding, such as this, to prove the execution and delivery of bonds otherwise than by the production of the bonds themselves. We are disposed to hold that section 52 of the present Practice act, (Hurcl’s Stat. 1908, p. 1626,) which is the same as section. 33 of the old Practice act, does not apply to chancery proceedings. Even if this were a common law proceeding, the proof showing the authority to execute and deliver the bonds in question, any other defense which would make the bonds void or voidable cannot be raised by the verified plea of non est factum. (City of Chicago v. English, 180 Ill. 476.) Proof that the president and secretary actually executed the bonds establishes a prima facie case, notwithstanding a verified denial. (Anderson Transfer Co. v. Fuller, 174 Ill. 221.) There can be no question raised on the evidence in this record as to the president and secretary actually executing these bonds.
The case of Lloyd & Co. v. Matthews, 223 Ill. 477, which is cited by appellant as upholding its contention that these bonds were executed and delivered without authority by Altgeld, we think clearly upholds his authority in that regard. It lays down the rule that the president of the company, by virtue of his office, is recognized as the business head of the company, and any contract pertaining to the corporate affairs, within the general powers of such officer, executed by the president on behalf of his corporation, will, in the absence of proof to the contrary, be presumed to have been done by authority of the corporation. The president of a corporation is presumed to have authority to deliver bonds which have been duly authorized to be issued, and an innocent purchaser cannot be put to the proof that he exercised that authority rightfully.
Appellant argues that the bonds in question are not negotiable because of the provision that some of them can be redeemed before maturity, under certain conditions, as set forth in the statement of the case. With this we do not agree. Dickerman v. Northern Trust Co. 176 U. S. 181; Hunter v. Clarke, 184 Ill. 158.
The further contention is made that even though these bonds are negotiable, as this is a foreclosure proceeding in equity, the court, under the ruling in Olds v. Cummings, 31 Ill. 188, will let in any defenses which would have been good against the trust deed in the hands of the trustee itself. It is a sufficient answer to this contention to say that no defense has been offered which would have defeated this trust deed in the hands of the trustee itself.
It is further contended that appellee McCormick employed as counsel the late A. M. Pence to advise him on the legal questions involved before he made the purchase of these bonds and certificate of redemption, and the fact that Pence examined, among other things, the records of the foreclosure proceedings under the first trust deed was sufficient to put him upon notice that Gov. Altgeld was without authority to sell these bonds. What we have already said we think effectually disposes- of this point. The authorities cited by appellant refer to bonds of a public or municipal corporation, but a very different rule prevails as to the bonds of a private corporation. (2 Morawetz on Private Corporations,—2d ed.—sec. 596; Bradley v. Ballard, 55 Ill. 413.) No evidence was offered to indicate that McCormick or any of the purchasers had any notice that would put a cautious man on inquiry as to the validity of these bonds. We find no evidence of bad faith or negligence shown on his part in the purchase of said bonds and certificate of redemption.
The appellant company paid interest on these bonds for four and a half years,—that is, for 1895, 1896, 1897, 1898, and the first part of 1899. The record shows that this interest was paid invariably by checks drawn by the company from its own bank account, and not by Altgeld, as claimed by appellant. These payments, taken in connection with the other facts appearing in this record, (including those occurring during the former foreclosure proceeding wherein it appeared that the appellant company, through its counsel, admitted, in effect,sthat these bonds were valid and properly held by Altgeld for sale and were not the property of the company but belonged to Altgeld, and that he should therefore have been made a party to the litigation,) estop the company in these proceedings from denying that these bonds were valid obligations against it, (Ragland v. McFall, 137 Ill. 81,) and while we refused to decide in the former case of Unity Co. v. Equitable Trust Co. supra, who was the owner of those bonds, we did hold that there was no evidence in that record that Altgeld or his estate owned the equity therein. It is plain, also, from the statement in that opinion, that said record, in our judgment, showed that Altgeld, as president of the company, had the legal authority to sell or borrow money on these bonds.
Appellant further contends that the proof on this record fails to show that the money obtained by Altgeld and Lanehart, either from selling or borrowing on some of these bonds, was ever used for the benefit of the company. The rules of law heretofore stated governing the purchase of these bonds by appellees sufficiently answer this contention. The burden was upon appellant to show bad faith in the purchase of the bonds by the present holders. This has not been done. It will not be out of place to state in passing, however, that, so far as the proof appears in this record, we think it shows effectually that the money that was obtained by Altgeld and Lanehart by selling or pledging these bonds was actually used for the benefit of the company. Altgeld, Lanehart and-Ford, three of the directors, are now dead. Kuebler, it is true, testified that he knew nothing about the sale or placing of any of these bonds as collateral, but he was present and voted for the resolution authorizing the execution and delivery of the trust deed and bonds under consideration. We think the proof also shows conclusively that Kimball, the secretary, considered that Altgeld and Lanehart had legal authority'to dispose of the bonds. He not only was present at the meeting when the resolution was passed by the directors, but as secretary he signed and executed the trust deed and all bf the bonds. He advised with Altgeld as to the employment of counsel to represent the company in the first foreclosure proceedings, and it must be presumed that he was cognizant of the defense made in that case. He informed would-be purchasers of the bonds, after that foreclosure, that these bonds were a good investment, and necessarily he must then have believed that they were valid in every particular.
From the facts in this record we think the allowance of solicitor’s fees was not unreasonable in amount. We are also of the opinion that the decree of the trial court was not erroneous in allowing interest at the rate of six per cent on the redemption money. The first mortgage bonds and certificate of sale bore that rate of interest, and the party redeeming was held to pay that rate on the amount of the sale. Mosier v. Norton, 83 Ill. 519; Simpson v. Gardiner, 97 id. 237; McMillan v. James, 105 id. 194.
Several other points have been discussed in the briefs, but what we have said we think fairly disposes of all the material questions that are before us for consideration. • The judgment of the Appellate Court will be affirmed.
Judgment affirmed.