Beindorff v. Kaufman

Ryan, C. This action was for the foreclosure of a mortgage securing the payment of three promissory notes given by David Kaufman and Kaufman Bros, to Charles Beindorff. The mortgage was made by Levi Kaufman and his wife, the parents of the makers of said notes. The defenses interposed by the mortgagors were duress, and' that the mortgage was given to compound a felony, alleged to have been committed by David Kaufman. From a decree canceling the aforesaid mortgage an appeal has been taken to this court. On the trial there was introduced evidence, and in this court argument is directed to the consideration that Levi Kaufman, with his associates, had, previous to the execution of the mortgage, received transfers of all the property of which David Kaufman and Kaufman Bros, were owners. No averments of the petition, however, warrant an inquiry as to whether or not Levi Kaufman held this property as trustee, and whether or not there were circumstances which rendered it but equitable that he should secure the claim of appellant. The action was one simply [827] for a foreclosure, in which, after several amendments, there were, beside the usual averments in such cases, statements as to an extension of time and the surrender of collaterals obtained by giving the mortgage in question. The finding of the trial court was that there was a sufficient consideration to sustain the mortgage, so that it is unnecessary to consider circumstances other than those tending to prove or disprove that the mortgage was procured by duress, or was given in consideration of compounding a felony. On the 24th day of December, 1887, appellant sold his cigar and tobacco store in Omaha to Kaufman Bros., a firm composed of David Kaufman and Isaac Kaufman. As part payment the notes hereinbefore referred to were executed, each for the sum of $1,000. As security for the payment of these notes David Kaufman assigned and delivered to appellant certain executory contracts and notes. These contracts had been made by David Kaufman to George M. Winkleman and Thomas Bethel, and provided that upon payment of the entire sum of $2,600, evidenced by the notes of Winkleman and Bethel to David Kaufman, the said Kaufman would convey the property, which was the subject-matter of the contracts, to Winkleman and Bethel. These executory contracts and these notes were those assigned as collateral by David Kaufman to appellant. These executory contracts were never recorded, neither was the assignment of them, and David Kaufman, taking advantage of this want of notice, was able to, and did, mortgage the land described in the executory contracts aforesaid to John L. Miles on December 29, 1887. When this was discovered by appellant’s attorney he prepared a complaint against David Kauftnan upon a criminal charge under section 28, chapter 32, Compiled Statutes, and under section 127 of the Criminal Code. This complaint was sworn to by Otto Beindorff, son of appellant. With this complaint in his possession, and two deeds necessary to cure defects in title to the land upon which a mort [828] gage was desired, appellant’s attorney and Otto Beindorff called on David Kaufman. Mr. Haller, the aforesaid attorney, then told David Kaufman that he had come on behalf of appellant with respect to the notes in controversy and to secure which said Kaufman had given certain real estate contracts and notes, and charged that since transferring said contracts he, the said David Kaufman, had mortgaged the property in said contracts described to John L. Miles without disclosing to Miles the prior sale of said land contracts; that the mortgage itself showed that it had been taken with warranties of title in the said David Kaufman against the existence of any incumbrances. David Kaufman admitted that these charges were true, but said he had no other security which he could pledge. Mr. Plaller then told him that he had brought a mortgage (describing it), ready for execution; that he had found the title first in David Kaufman, by whom it had been transferred to David’s father by quitclaim deed in which David’s wife had not joined, and he urged that David’s father and mother should sign the above mortgage, and said that if there was not -executed a proper quitclaim deed by David and his wife, and the proposed mortgage by David’s father and mother, that on behalf of appellant he would begin a prosecution against David upon the information which he then read to David. Upon the suggestion of Mr. Rosenfield, a brother-in-law of David, all parties present went to the office of Mr. Ervin, an attorney at law, to whom was stated the charges against David, in substance as above set forth. Mr. Ervin thereupon inquired of David whether or not these charges were true, to which inquiry David replied that he guessed the charges were true. To Ervin’s inquiry whether or not David’s father would sign the mortgage, David said he would, that his father would do anything for him. A messenger was sent for David’s father, Levi Kaufman, who at once came to Ervin’s office. As the finding of the trial court sustained the plea of [829] duress, it is necessary only to inquire whether or not there was sufficient evidence to sustain that finding. The trial took place in June, 1891, at which time Levi Kaufman testified that he would be seventy-five years of age in the winter following; that when he went into Mr. Ervin’s office Mr. Haller said, “I want you to sign a mortgage;” that witness said, “I will sign no mortgage;” that Mr. Haller said, “If you do not sign that mortgage I will send your son to Lincoln to-night in prison;” that witness still refused to sign the-mortgage; that witness then left the room and met his son David, who asked him to sign it, which witness refused to do, saying, “ I will not sign my property, — my home;” that David began to cry and said to witness, “ For mercy sake, for my children .and me, sign it;” that witness thereupon signed it. It is rendered quite probable by the testimony of other witnesses that there was no threat to commit David to prison in Lincoln on the evening referred to, but the testimony is uncontradicted that Levi Kaufman was given to understand by Mr. Haller that unless the mortgage was signed there would be commenced a prosecution against David that same night, though the conversation referred to was between the hours of 6 and 7 o’clock in the evening. After Levi signed the mortgage it was the same evening taken to David’s mother, who also signed it. She was at that time about sixty-three years of age. The testimony of both these parents was that the mortgage was signed solely to prevent a criminal prosecution of their son David. It is urged, however, in argument that the fact that the proposed prosecution was for an admitted crime relieved the transaction of the imputation of duress, and in support of this contention the case of Sanford v. Sornborger, 26 Neb., 295, is cited. If the mortgage in question had been given by David Kaufman, this case would be in point, for David could not be heard to complain of the logical effect of his own confessed misconduct. As against David’s [830] parents, however, no such consideration^ has force. By threats of a prosecution of their son if they did not incumber their home, and the promise that no prosecution would be commenced if they did, this mortgage was obtained to secure a debt for which the mortgagors were in no way liable. This result was attained by appealing to their fears and the love of their offspring. The motive, therefore, can hardly be classed with that of a felon seeking to avoid the punishment of his crime. As an original proposition, it might be that we should not .have reached the same conclusion of fact as that reached by the .trial court upon conflicting evidence. This result is, however, not without sufficient support, and we therefore accept as proved the results necessarily implied in the finding of the trial court. It is argued that there was a ratification of the mortgage by payments having been made on the notes by Levi ‘Kaufman and his wife. There were payments made, but there was no direct evidence whether these payments were made by Levi Kaufman or not. Certainly they were not made by his wife. Levi Kaufman, in direct terms, testified that he in no way made or was a party to.such payments. At any rate, we cannot see that these payments, if made by Levi, were of any great controlling force, for neither Levi nor his wife had ever agreed to make payments. They only gave security that David would pay; hence, such payments as were made were only in discharge of David’s undertaking. There appears no change in the status of appellant superinduced by these payments, neither does the failure of Levi and his wife to insist that the mortgage was void ab initio seem in any way to have prejudiced his rights. The judgment of the district court is Affirmed.