Pearson v. Seay

A. J. WALKER, C. J. The only question presented on the former appeal in this case, was; whether the complain ant’s bill contained equity. It was then decided, that the facts alleged in the bill evidenced a sale of land to the complainant in consideration of his notes, subject to a. right to re-purchase in the vendor ; and that the complainant was entitled to relief against the holder of the notes for the purchase-money, on account of the fraud in the sale. The material facts upon which our decision was predicated, were, that the complainant executed his notes for six hundred dollars ; that the notes were assigned for the purpose of raising money, and that the deed to complainant contained a stipulation, that it should be void .upon the payment at a specified day, by the grantor to the grantee, of six hundred dollars. We rested our decision upon the absence of any obligation on the grantor to pay the notes, or protect his grantee against their payment, and on the anomaly which would be presented, by assuming that the grantor and grantee became reciprocal debtors to each other, in the sum of six hundred dollars, and that the grantor secured the payment of his debt by mortgage. The case is now before us upon appeal from a decree upon the case made by the proof and pleadings. The evi dence shows, that the notes of the .complainant were executed for the accommodation of the payee, to be discounted by the defendant Seay, for the payee ; and that the land was conveyed for the purpose of securing and indemnifying the complainant against the notes executed for the accommodation of the payee. It thus appears that the maker of the deed was under an obligation to protect the complainant against his notes, and that the deed was designed merely to operate as a security to him against the payment of the notes. The two points upon which our former decision was placed, are thus met, and obviated. Under the proof, the grantor was under an obligation, the [647] performance of which might be secured ; the deed was intended to afford the security ; and the anomaly mentioned does not exist; for there is only a debt by the complainant, and an obligation upon the grantor in the deed to protect him against it. It is plain that the transaction, as explained by the proof, is a mortgage. In support of this proposition, we refer to the cases cited in Pearson v. Seay, 35 Ala. 612. The misrepresentation of the mortgagor, as to the title to land mortgaged for the indemnity of the mortgagee, can afford no ground for equitable relief against the holder of the note given by the mortgagee to enable the mortgagor to raise money. Affirmed.