Buchanan v. Griggs

Reese, J. Plaintiffs, as the widow, heirs at law, and administrators of Job Buchanan, filed their petition in the district court, — 123 — in which they allege, substantially, that Job Buchanan died on the 18th day of Sept., 1880; that on the 4th day of July, 1871, Samuel Jones was the owner in fee-simple of the northwest quarter -of the south-west quarter of section number eleven, in township number four north, of range number six east of the sixth principal meridian; and that on that day he executed and delivered a mortgage on said property, together with 'other real estate owned by him, to one John Armstrong, to secure the payment of the sum of $4,200.00, due in one year after date, and which mortgage was alsa signed by the wife of said Samuel Jones; that Jones died on the 8th day of February, 1872; that John Armstrong assigned the note and mortgage to one William Null, who, on the 3d day of October, 1872, commenced an action ta foreclose the mortgage. On the 8th day of November, 1877, Null obtained a decree of foreclosure, the amount of the decree being $4,300.00. During the jear 1878 Null sold and transferred the decree to one James M. Armstrong, who afterwards sold and transferred it to said John Armstrong, the original mortgagee. On the 26th day of July, 1880, John Armstrong sold and transferred it to. said Job Buchanan, now deceased. On the 31st day of July, 1880, an order of sale was issued, and on the 7th of September, of the same year, the land was sold by the sheriff, under the order of sale, to the said Job Buchanan, which sale was confirmed by the district court and a deed ordered, which was executed by the sheriff on the 22d day of March, 1881, and the deed duly placed on record in the deed records of Gage county; that by these proceedings the plaintiffs became the owners of the fee-simple titles to the real estate in dispute. It is further alleged that on or about the 13th day of April, 1874, and while the foreclosure suit was pending, one John Jones, who was the son and heir of Samuel Jones, and who was one of the defendants in the foreclosure proceeding, with a fraudulent intent, executed and delivered ta — 124 — the defendants, Nathan K. Griggs and Wm. H. Ashby, •a mortgage for $500.00 upon said land, and that the mortgage was placed upon the mortgage records of Gage county, ■and that the only consideration therefor was an agreement •on the part of said defendants that they should defeat the foreclosure proceedings; that if they failed to do so the mortgage should be null and void; and that they did fail to defeat the foreclosure; that at the time of the execution of said mortgage the said John Jones had no right, title, or interest in or to the land, except as one of the heirs of said Samuel Jones, then deceased, all of which said Griggs and Ashby Well knew, and that all of said interest of said John Jones Was forever barred and foreclosed by this final decree and •sale under the foreclosure of the mortgage executed by •Samuel Jones; that on the 3d of December, 1878, Griggs and Ashby commenced an action in the same court for the purpose of foreclosing the mortgage executed to them by ■John Jones, and made the heirs and administrators of Samuel Jones, as well as John Armstrong, who was then the ■owner of the decree above referred to, parties defendant; and that John Armstrong appeared and filed his answer, setting up the foregoing facts, and which were a full defense to the action, when a contract was entered into between John Armstrong and Ashby and L. W. Colby, who Was the attorney for Griggs and Ashby, whereby Armstrong, for a valuable consideration, purchased the note and mortgage from Griggs and Ashbyh and it was agreed that ■he was to have all their interest therein and in the foreclosure thereof, the same to be prosecuted to a final termination in their name but for his benefit, and that he was to be the owner of the decree wrhen finally obtained, and that Upon the sale of the property it was to be bid in for him; that Armstrong made no further defense to the foreclosure suit and allowed them to take their final decree, relying upon their agreement that it was to be done for his benefit, the decree being rendered on the 1st day of October, 1879; — 125 — that the consideration paid for said note and mortgage was: the full amount they would have been entitled to had their-note been based upon a valid consideration; that after the decree was rendered the land was to be bid in by them in his name; that the land was sold by the sheriff under the .decree and order of sale, and on the 10th day of April,. 1880, and in pursuance of said agreement, the real estate-was sold, nominally, to Griggs and Ashby, who bid it in in. their own names, but for the use and benefit of said Arm-* strong, and that he being the real party for whom the land was purchased, he became entitled to a deed upon confirma-* tion of the sale, which took place on the 13th day of April,, 1881. On the 26th day of July, 1880, Armstrong' sold and assigned to Job Buchanan all his interest in the decree,, and by a quit-claim deed conveyed to him all his interest; in the real, estate, and Buchanan took the property subject to taxes and costs, which he assumed and agreed to payj that -from the time of the making of the agreement between Armstrong and defendants, Griggs and Ashby, until the sale of the property by the sheriff, Ashby acted as the attorney for Armstrong and Buchanan, and advised the-purchase by Buchanan of Armstrong’s interest, and that relying thereon Buchanan made the purchase; that the sale to defendants was confirmed, but that they now claim that they are the owners of the decree, and that they purchased the property for themselves, and not for Armstrong, and that they are entitled to a deed, and unless restrained from doing so the sheriff would make to them instead of to Armstrong a deed of conveyance; that they claim that said John Jones was the absolute owner of the mortgaged premises at the time of the execution of the mortgage by him to them, and that the mortgage created a valid lien upon the land; that the basis of their claim is, that in the year 1869 John Jones, being then a minor, owned the land, and while yet a minor conveyed it to his father, Samuel Jones, who mortgaged it to Armstrong in 1871, and that — 126 — after attaining his majority disaffirmed the conveyance and mortgaged to them. But that’ John Jones not only did not disaffirm the conveyance after attaining his majority, but that he fully affirmed and ratified the same, and that he and all persons claiming under, him are estopped to set up any claim thereto by reason of his minority at the time of his conveyance to his father; and that, at all events, Griggs and Ashby are estopped from setting up any claim by reason of the proceedings had in connection with the contract with Armstrong and the entering of the decree of foreclosure. An injunction was prayed for restraining the execution of the deed by the sheriff, and that he be decreed to execute the deed to Armstrong or Buchanan; that their title be quieted as against defendants and all persons claiming under them, or that the mortgage from John Jones be declared null and void, and to create no lien upon the premises adverse to plaintiffs, and that the decree of foreclosure and sale by the sheriff be annulled and set aside, and for general relief. To this petition the defendants answered, admitting the death of Samuel Jones, and the representative capacity of plaintiffs, the execution of the note and mortgage by him, their assignment to William Null, the rendition of the decree of foreclosure in his favor,- the assignment to James Armstrong and his assignment to John Armstrong, and the assignment by him to Job Buchanan, and the execution of the sheriff's deed, but deny that Samuel Jones was the owner of the land in question at the time of the execution of the mortgage. They also admit the execution of the mortgage to - them by John Jones, and that, at that time they were in partnership, the subsequent foreclosure proceedings by them, the execution of the contract with Armstrong, but allege that it was afterwards rescinded, They admit that they claim to be the owners of the decree, and that they demand a deed from the sheriff, and allege — 127 — that they are entitled to it. They allege that John Jones, In 1869, and when a minor, conveyed the . premises to his father, Samuel Jones, deny that upon attaining his majority he ratified the. conveyance, but allege that he expressly disaffirmed it, and mortgaged the land to them, and that at the time of making the mortgage he was the legal ■and equitable owner thereof. The answer then reviews the allegations of the petition, and plead various estoppels which we do mot deem it necessary here to notice. After trial the plaintiffs filed an “ amendment to their petition to make it correspond with the facts proven,” by which they allege that after the rescission of the contract between Armstrong and Ashby and Colby, on the 12th of February, 1880, another agreement was made between Armstrong and Ashby in which it was agreed between them that in consideration of what Armstrong had paid Ashby, amounting to over f>700, Ashby was.to put Armstrong in possession of the property in controversy, and was to ■carry out the original contract made between Armstrong and Ashby and Colby, and that Ashby was to proceed to' have the property sold and purchased in the ..ame of Armstrong, and the deed made to him, and that, relying upon the'agreement with Ashby, he paid no further attention to the matter, but paid to Ashby the said sum of §700. That defendants did bid in the land, but in their own name instead of his. A trial was had which resulted in a finding and decree by the court, setting aside the sale made by the sheriff, but holding that the lien created by the mortgage and decree of foreclosure was a valid and subsisting lien in favor of defendants, dissolving the injunction, and ordering the resale of the property. From this decree plaintiffs appeal. According to our view of the case the decree of the district court cannot stand. By the pleadings and proofs, it Is established beyond any question that John Jones, while — 128 — a minor, received a conveyance of the land in question from his father, and reconveyed it to him. The deed made by the father was on the 20th day of February, 1869. Thereconveyance was on the 21st day-of September, 1870. The mortgage to Armstrong was executed July 4th, 1871. On the 22d day of January, 1872, John attained his majority. On the 8th day of February, 1872, Samuel Jones, died. From the time of the acquisition of the title by Samuel Jones — long prior to the conveyance to John — - until his death he was in the possession of the land, John never at any time being in possession. On the 13th day of April, 1874, John Jones executed the mortgage to defendants, that being the first act of his with reference to-the land. The proceeding to foreclose the mortgage executed by Samuel Jones was commenced on the third day of October, 1872, to which John, then having attained his-majority, was made a party defendant, which action was pending at the time of the execution of defendants’ mortgage. . It cannot be said that the bare execution of this mortgage was a disaffirmance of the conveyance to Samuel Jones, for two reasons: First. Before the simple execution of a deed made by a person after coming of age will amount to a disaffirmance of a conveyance made during minority, the second deed must be of as high a character as the first. That is, it must appear on its face to undo that which has been done by the former deed. If the first is an absolute conveyance, so must the second be in order to work a disaffirmance of the first within itself. Jackson v. Burchin, 14 Johns., 124. Jackson v. Carpenter, 11 Id., 539. Bool v. Mix, 17 Wend., 132. Eagle Ins. Co. v. Lent, 1 Edw., 301. Tucker v. Moreland, 10 Peters, 58. Again, we think it is well established, both upon prin-. ciple and authority, that the second deed must be so inconsistent with the first that both deeds cannot stand, in. — 129 — order of itself to work a disaffirmance of the first. McGan v. Marshall, 7 Humph., 121. Eagle Ins. Co. v. Lent, 6 Paige, 635. Schouler’s Domestic Relations, 588 (2d Ed.) , “ In this state a mortgage of real estate is a mere pledge or collateral security creating a lein upon the mortgaged property, but conveying no title nor vesting any estate, either before or after condition broken.” Davidson v. Cox, 11 Neb., 250. Second, At the time of the execution of the mortgage to defeudants, John Jones was one of the joint owners of the land with the other heirs of Samuel Jones (he being then deceased), subject only to the mortgage made by Samuel to Armstrong, the life estate of his mother, and the claims of the creditors of his father, if any existed, assuming that he-did not desire to disaffirm the conveyance to Samuel., This interest was a mortgageable one and was subject to> the decree in the foreclosure suit. Jones on Mort., § 1411, 1314. There is nothing shown by way of declaration or recital in the mortgage which would indicate any intention of the mortgagor to disaffirm any prior act of his. It may also be noted as a circumstance tending to throw some light on his intention at the time of the execution of the mortgage, that on the 16th day of May, 1876, he conveyed the real estate in- question to one M. ~W. Thompson, and in the deed he expressly excepts from the covenant of warranty the mortgage executed by his father to John Armstrong, the exception being as follows: “Subject,"however, to a mortgage executed by Samuel Jones to John Armstrong, dated January 5, 1871, and recorded in the records of Gage county, book B, page 161.” The deed also excepts the mortgage executed to defendants. It is true that the date is referred toas “January 5th, 1871,” while the mortgage to Armstrong was dated July 4th, 1871, but it is proven that Samuel Jones never executed but the one mortgage to John Armstrong, and there can be no doubt but that it was the — 130 — one referred to in the deed. It was clearly impossible for the mortgage to Armstrong to stand unsupported by any title in Samuel Jones. His title was derived from John Jones. By the reservation in the deed to Thompson, John Jones clearly recognized the validity of the Armstrong mortgage. Schouler Dom. Rel., 438. By that he recognized the validity of his deed to his father. The deed to Thompson was executed more than four years after John’s majority. Had it been the intention of John Jones to disaffirm the deed executed by him to his father it ■would be quite reasonable and in accord with ordinary human action for him to have done some act winch urnuld have unequivocally demonstrated that intent. No such demonstration has been made. The foreclosure of the Armstrong mortgage was persistently fought in the courts, being finally decided in Jones v. Null, 9 Neb., 57, but not upon the ground that Samuel Jones had no title to the land at the time of the execution of the mortgage or that John had disaffirmed his deed to him. If he had such, a defense and desired to avail himself of it, he was called upon to do it in that action. It is very evident such was not his intention. Such being the case, it is clear that Griggs and Ashby, having received the mortgage during the pendency of that action, could, stand in no better or more advantageous position than did their grantor. Jones on Mortgages, § 1411. Metcalfe v. Pulvertoft, 2 Ves. & B., 208. McPherson v. Housel, 13 N. J. Eq., 301. Jackson v. Losee, 4 Sand. Ch. 407. Zeiter v. Bowman, 6 Barb., 133. Griswold v. Miller, 15 Id., 520. Cleveland v. Boerum, 3 Abb. Prac., 294. Ostrom v. McCann, 21 Howard’s Pr. Rep., 431. The foreclosure of the Armstrong mortgage forever barred the rights of John Jones in the land, and with his, the rights of Griggs and Ashby and of Thompson. The execution of the sheriff’s deed conveyed to the purchaser all the title of all the parties to the action. Jones on Mortgages, § 1654. Young v. Brand, 15 Neb., 601. See also § 853 of the Civil Code. — 131 — Prior to the time the contract between Ashby and Arm;stroug was made, Griggs and Ashby virtually had no standing in court in their foreclosure proceeding, and the defense plead by Armstrong was a complete bar to their recovery. The testimony is contradictory as to what the real agreement between them was. Griggs insists he gave no person any authority to make it for him. As all contracts must be mutual to be binding, if he was not bound Armstrong was not, and has therefore been deprived of his defense unjustly. Taking the testimony for our guide, it is evident there has been a mutual misunderstanding between tbe parties, and by that misunderstanding Armstrong has been deprived of his defense in tbe suit of Griggs and Ashby against Jones and others. It follows that the decree of the district court must be reversed, and the decree in the case of Griggs & Ashby against Jones and others, together with all proceedings thereunder, set aside and vacated, and Armstrong or his grantee be permitted to make his defense. Judgment accordingly. The other judges concur.