Girault v. Adams

Irving, J., delivered the opinion of the Court. The undisputed facts of this case are as follows: Joseph B. G-irault, a professor in the Naval'Academy at Annapolis, in August, 1877, purchased a vacant lot of ground, in Annapolis, for eight hundred dollars, which he paid for — 8 — with, his own money, and caused to he conveyed to his wife, Elizabeth F. Girault. Mrs. Girault had no property of her own before her marriage and had acquired none after marriage, except what she has received from her husband; who now has none, because he has given all he had to his wife. Desiring to build a house on the vacant lot, in the spring or summer of 1879, by the authority of his wife, Mr. Girault negotiated with a building association for the loan of money to build with, agreeing to mortgage the property in security for the loan. Finding he could secure the money from an unmarried sister, who was living with him, the negotiations with the building association were dropped. The sister had a mortgage of $3325 upon property in New Jersey, which was not due, and which was paying her seven per cent, interest. This' was all the property the sister had, and was the remnant of what had been received by her from her father’s estate, through this brother who was executor. This mortgage she agreed to sell, and did sell, at considerable loss. Of the proceeds she paid over to her brother the sum of $2965, in three different payments, as follows, in April,' 1879, $665; in August, $2000; and in November of same year, $300. All this money was applied to the building of the house. The bill charges that before this money was supplied there was an express agreement between her brother, and his wife on the one side, and the complainant on the other, that the mortgage should be sold for the purpose of raising the money, and that complainant should be secured by a mortgage on the property so that she should suffer no loss by the sale, and should be secured the annually accruing interest thereon. The defendants in their answer deny the agreement set up in the bill; but Mr. Girault admits the receipt of the money and its use in building the house on 'his wife’s lot; though he sets up another agreement with his sister respecting the loan, which, however, includes in it a contract for mortgage on this very property to secure — 9 — the interest annually, and a portion of the principal; while the wife in the answer denies all knowledge of any agreement to mortgage her property to the complainant. The testimony consists entirely of the evidence given by the parties in their own behalf, and on cross-examination ; and before considering the questions arising upon its legal effect, we will dispose of an exception to a portion of it. Exception was taken by complainant to the re-examination and testimony given therein, upon the 15th of February, 1882, after the parties had been examined and cross-examined and discharged without any reservation of the right to recall, or agreement for further examination. This exception was sustained by the Circuit Court and we think properly, and for sufficient reasons, which we adopt, in the language of the Circuit Court: “These witnesses had been examined on the 12th day of January, 1882. Mrs. Adams, the complainant, had testified, on the Ith of October, 1881, before they were examined; and when they were subsequently examined was the time for them to have given, in their examination-in-chief, any testimony in their power to give in contradiction of what she had said, ifo questions specially directed to her testimony were then propounded to them, and after cross-examination, they left the commissioner’s office. If the same state of case had occurred in a trial at law, they could not have been thus recalled, without the special leave of the Court, for the purpose of contradicting what a previous witness had stated; and the rule is the same in the examination of witnesses before a commissioner in a case in equity. (Heise’s Case, 44 Md., 453.) - It is important this rule should be observed, not only for the orderly conduct of an equity suit, but for the purpose of justice. A witness and a party to a cause, who had been examined and cross-examined, after his opponent had testified, ought not to be recalled after he has had three months to reflect upon his adversary’s testimony, for the purpose of contradicting that — 10 — testimony, unless special leave of the Court is first obtained.” We will add that the Court should always require satisfactory ground to be laid for such leave to be granted. This being a bill for specific performance, it was the unquestionable duty of the complainant to make out the case set up in the bill with such distinctness, certainty and legality in ■all its parts that the Court could have no difficulty in deciding exactly what the contract was between the parties which was sought to be enforced, and that it was such a ■contract as ought to be enforced by its decree. We do not think the precise contract, as alleged, has been so.satisfactorily established in the proof that the Court would be justified in decreeing its enforcement; but we think it a case for decree for compensation, under the prayer for general relief. It is abundantly clear from the testimony of Mr. and Mrs. Girault, that Mr. Girault had been .authorized, by his wife, to borrow money on mortgage upon the property, for the purpose of erecting a house on Mrs. Girault’s lot. Application had been made to a building association for it, with the oifer of a mortgage in security for the loan. Thus far his authority is admitted. The negotiation with the building association was discontinued, because, and only because, the money could be secured from the sister. Now, Mr. Girault states in his testimony that the interest on all was to be secured by a mortgage ■on this’very property; but he insists that only a portion of the principal was to be so secured. This qualification of the agreement the sister denies; so that his averment is not made good; while he> establishes the receipt of the money, and its application to the building of the house on his wife’s property. Manifestly, he considered himself fully authorized to borrow money from any source, on the faith of that property, or he would not have engaged to mortgage it to his sister. Mrs. Girault says the money was to be borrowed from the building association and was — 11 — not borrowed from it, because it was procured from another source. She knew, therefore, that it was obtained. She knew what was to be done with it, for she directed its procurement, for the purpose of building a house on her lot. The proof is, it was so applied. She says her husband told her it was not obtained from the association, but was obtained elsewhere. Erom all that she says, it is impossible to doubt that she knew the exact source whence it came.- In one part of her testimony she says she only knew of his getting some money from his sister, via., the thousand dollar payment. In another part of her testimony, when speaking of the whole loan, she says that Mrs. Adams begged her husband to take it, and she was present at some, if not all, the business interviews,. The knowledge of the facts she states, assuming them to be true, establishes the knowledge on her part of where the money was obtained, and that it was for her use in building the house; for the negotiations with the building association were broken off because of the procurement of the money from Mrs. Adams. We irresistibly conclude, therefore, that she knew the money was borrowed from Mrs. Adams, and that it was borrowed for her, to build her house ; that she knew it was so used, and also, that it was borrowed on the faith of that property. The husband was not seeking the money for himself, for he had no property to improve or to mortgage. He was borrowing it for her ; and, ■as she knew he was without money, with which to repay it or secure it, she could not have thought that he only was to be bound for it. The husband did not get the money from the source which the wife admits was to be secured by mortgage ; but it was obtained from the complainant upon promise of a mortgage on that very same property to secure the payment of the interest annually, as we have already stated. It may be true, that there was no special authority to borrow from the sister and pledge the wife’s property for its payment; but that is not — 12 — necessary if he had general authority to borrow wherever he could. Inasmuch as the wife knew whence it was obtained, and did not object, but on the contrary, acquiesced in its being applied to the permanent improvement of her property, by a building greatly enhancing its value, we must regard her as having accepted the loan with sufficient knowledge of the facts to make the husband’s act within the scope of his authority. It appears that, at the time the money was loaned, Mrs. Adams did not know the property had been conveyed to Mrs. Girault, but the brother knew it, and Mrs. Girault knew it; and as the negotiation was with reference to it as. security, the loan must, in equity, be. regarded as made to the.person actually getting the benefit, and on the faith of the property designated, and really owned by the person benefited. The failure to disclose the true state of the title, and the misapprehension of the lender about it, only commends the case more strongly to the ear of a Court of equity. We think there is abundant proof to justify this Court in preventing the wrong which the appellants, by their resistance of this claim, seek to inflict upon Mrs. Adams. The well considered cases of Bowie vs. Stonestreet, 6 Md., 418; Green vs. Drummond, 31 Md., 71; and Powel vs. Young, 45 Md., 494, fully establish that where specific performance cannot be decreed, because of uncertainty in the terms of the agreement, insufficiency of proof to clearly establish the precise contract alleged, or by reason of the Statute of Frauds being relied on in defence, a Court of equity will, when there is no remedy at law, render relief by way of compensation to the extent of money actually paid upon the alleged contract. An unreported case in this Court, decided in July, 1858, Jacob Eackle vs. George W. Smith and others, also maintains this doctrine. We agree with the Circuit Court, that it is perfectly competent for a husband and wife to make a binding agreement for the improvement of the wife’s — 13 — estate; and if it is performed by the other party, the money actually advanced ought to be charged on the wife’s estate. To justify a Court of equity in so charging the estate, it is not indispensably necessary that the intention to charge the separate estate should be evidenced in writing. It may appear aliunde. Koontz vs. Nabb, 16 Md., 549; Jackson vs. Cole, 29 Md., 71. If it sufficiently appear that the dealing was had with direct reference to the estate belonging to the wife, no matter whether the proof be in writing or in parol, her estate will be charged in equity. From what we. have said already, it is clear the wife’s estate should be charged in this case. With respect to the appeal of Mrs. Adams, we need only say that the Circuit Court committed no error in disallowing the loss on the mortgage in the sale of it. Only the money actually advanced will be compensated for in the decree to be passed on the remand. The cause will be remanded under Article 5, section 28, without affirmance or reversal, to the end that a decree may be passed directing the sum of twenty-nine hundred and sixty-five dollars, with interest from the first day of September, eighteen hundred and eighty, until paid, or brought into Court, to be paid or brought into Court to be paid the complainant, Mrs. Adams, together with the costs of both Courts, by a day to be named by the Court, and in default of such payment, directing the sale of the said property as the separate property of Mrs. Girault for its payment. (Decided 13th December, 1883.) liemanded, without affirmance or reversal, under Art. 5, sec. 28, of the Gode.