Detroit National Bank v. Blodgett

Long, C. J. This proceeding was commenced for the foreclosure of three mortgages. Complainant’s claim is that Charles C. Blodgett was the owner of certain property in Detroit, known as “Lots 1, 2, and 3 on the north side of Franklin street,” and “Lots 1, 2, and 3 on the south side of Woodbridge street.” His wife, Cornelia, had an estate for her own life in other property in Detroit, known as “Lots 29, 30, 36, and 37 of the Louis Moran Farm.” The children of Mr. and Mrs. Blodgett, namely, Elma Louise Smith, May N. Blodgett, Alice Blodgett Craig, Charles G. Blodgett, Ralph C. Blodgett, and Adelaide P. Blodgett, held the remainder in fee, each owning an undivided one-sixth. The title of Mrs. Blodgett and the children to the property owned by them came from the will of Solomon Gardner, the father of Mrs. Blodgett. — 162 — He died in 1878. The place had been his homestead, and it became the home of Mr. and Mrs. Blodgett and their children after the death of Mr. Gardner. As early as 1888, Mr. Blodgett formed an intention to tear down the buildings that were then upon the place, and to erect thereon rentable buildings called “flats,” and to be known as the “Blodgett Terrace.” At this time but three of the Blodgett children had arrived at full age. They were Elma Louise Blodgett, now Mrs. Smith, May N. Blodgett, and Alice Blodgett, now Alice Blodgett Craig. To accomplish the building of the terrace, Mr. Blodgett borrowed money from the complainant, the Detroit. National Bank, and from time to time gave to complainant his notes at four months for the money so ■borrowed. The payment of these notes was guaranteed by Mr. C. H. Buhl,' and two mortgages were given to him to protect him because of such guaranty. Both mortgages bore date April 30, 1888. One mortgage was on the property owned by Mr. Blodgett, as heretofore stated. This mortgage was signed by Mr. and Mrs. Blodgett. The other mortgage was on the property owned by Mrs. Blodgett and the children. This was signed by her and the three children- who had then become of full age, namely, Elma, May, and Alice. The money borrowed was expended in the building of the Blodgett Terrace. This terrace was wholly on the property owned by Mrs. Blodgett and the children, and the expectation was that the investment was for the benefit of the family. At the outset the venture was supposed to be a good one in a business sense, though it did not turn out to be so. Charles, the fourth child, became of full age on the 13th day of February, 1891. In pursuance of the family understanding, and on the 17th of that month, four days after Charles had become of age, a new mortgage was given, signed by Charles alone. The mortgage from Charles covered all the mortgagor’s right, title, and interest in and to the terrace property. Its condition was as follows: — 163 — “These presents are upon the express condition that if Charles C. Blodgett, father of the party of the first part, shall pay at maturity all notes made by him, and indorsed by said Christian H. Buhl, and held by the Detroit National Bank, or any and all renewals of notes so made, indorsed, and held, or which may be hereafter so made, indorsed, and held, and save the said Buhl harmless from all loss or damage by reason of an agreement dated April 30, 1888, between said Buhl and the said bank, wherein he guarantees to said bank the payment of all notes discounted by said bank for said Charles C. Blodgett, it being understood that the notes now held by said bank so made and indorsed were given for moneys borrowed to erect the building' now on the aforesaid premises, in consequence whereof I have been benefited, and the liability for which moneys I should share with Cornelia H. Blodgett, Elma Louise Blodgett, May N. Blodgett, and Alice Blodgett Craig, who have given a mortgage on said premises dated April 30, 1888, to secure the payment of said notes, and to save said Buhl harmless on account thereof, the consideration moving to me being the benefit my estate has derived from the use made of said moneys, and, further, the agreement of said Buhl and said bank to grant reasonable renewals of said notes, then these presents and said notes shall cease, and be null and void.” The agreement referred to in the foregoing condition was made contemporaneously with the making of the two mortgages first herein mentioned, namely, the one signed by Mr. and Mrs. Blodgett and the one signed by Mrs. Blodgett and the three older children. About a year after the giving of the mortgage by Charles, and on the 28th day of January, 1892, the indebtedness of Mr. Blodgett to the bank had reached the sum of $100,000, whereupon, and on that day, Mr. Blodgett, Mrs. Blodgett, and the four older children, Elma, May, Alice, and Charles GL, gave their bond for that sum to complainant; principal payable on or before five years from its date, with interest at 6 per cent, per annum, payable monthly. At the same time two new mortgages were given. One was on the property owned by Mr. Blodgett, and was signed by Mr. and Mrs. Blodgett; the other was ■ on the property of Mrs. Blodgett and the — 164 — children, and was signed by her and the four elder children mentioned. The three former mortgages, including the one given by Charles, were discharged. Ralph C. Blodgett, the fifth child, became of full age January 9, 1894. He was married on April 30, 1890, soon after he became 17. Shortly after he became of age, and on January 18, 1894, he gave to the bank a mortgage on the terrace property. At this time he was living at 234 Woodbridge street, on the opposite side of the street from the terrace. The rent of this house was paid by his father. The condition of this mortgage is as follows: “ Provided, always, and these presents are upon the express condition, that if Charles C. Blodgett, Cornelia H. Blodgett, Elma Louise Smith, May N. Blodgett, Alice Blodgett Craig, and Charles G. Blodgett, or either of them, shall pay or cause to be paid to said Detroit National Bank the sum of $100,000 on or before the expiration of five years from January 28, 1892, with interest thereon at the rate of six per cent, per annum, payable monthly, according to the terms of a certain bond executed by them bearing date January 28, 1892, and secured by mortgage executed by them, except said Charles C. Blodgett, beai’ing the same date, and recorded in Liber 298 of Mortgages, page 127, said bond and mortgage having been given to secure moneys loaned for and used in erecting the building on said lots hereinbefore described, and therefore used for the benefit of said Ralph C. Blodgett, as well as for the benefit of said mortgagors, for which reason the security of this mortgage is given, then these presents and said bond shall cease, and be null and void. ” The payments were largely behind at the time this suit was begun, and there was unpaid at the time of taking the decree the amount stated therein. The bill was filed for the foreclosure of the three mortgages, namely, the two of January 28, 1892, and the one subsequently given by Ralph. Originally, Mr. Blodgett was a defendant. He died, and fhe suit was revived. Mr. Ered C. Harvey, his administrator, was made a party; so was Adelaide P. Blodgett, the sixth child of Mr. and Mrs. Blodgett. The bill was taken as confessed by all of the defendants — 165 — except Charles G., Ralph, and his wife, Mary. Marj^ was under age at the time she signed the mortgage. This was conceded at the hearing, and it was consented by the complainant that the bill should be dismissed as to her. The Portage Red Stone Company and John P. Ruhl were made parties under the- subsequent incumbrance clause. Adelaide P. Blodgett was made a party because of the interest derived by her upon the death of her father in the property which had been his, and. her interest in the terrace property is exempted from the decree. The contention of the defendant Charles G. Blodgett is that when he joined in the execution of the terrace mortgage, and the bond to which it is collateral, he was young and inexperienced, that he did not fully understand their contents, and that he executed them through fear of his father, and that they should therefore be set aside as -to him. Ralph C. Blodgett contends that when he and his wife executed the mortgage of January 18, 1894, they were then occupying a house the rent of which was paid by his father; that he and his wife were wholly dependent upon him for their house rent and board; that, before and directly after he became of age, his father practically forced him to execute the mortgage, and he feared that, if he'refused to sign, his father would cease to pay the rent, or furnish a home and food for his family; that his father was a man of violent temper, and he did not wish to cross him; that under these circumstances he signed the mortgage. His wife, in her answer, makes the same contention. These defendants, Charles, Ralph, and Mary Blodgett, all contend that they received no actual benefit-from the moneys mentioned in the mortgages. Defendants introduced several witnesses, who testified that the elder Mr. Blodgett- was a man of rough, coarse ways, of large size, with a heavy voice and violent temper, and of a domineering disposition, and much given to profanity and vileness of language. They gave it as their opinion that his children would not dare to disobey or cross him. In reference, to the circumstances of signing the first mortgage, Charles testified-: — 166 — “I was working for the First National Bank at that time [date of execution of mortgage], and I came home about 4 o’clock in the afternoon; and he [father] says, ‘I want you to go down town with me.’ And I supposed he wanted me to go down and hold the horse for him while he went in somewhere. So I got into the buggy, and we went down, and when he turned off Jefferson avenue he said, ‘I want you to sign some papers.’ Well, I said I didn’t care to sign those papers. I said: ‘You are not getting sufficient out of that thing to pay, and I don’t see any reason why you should make us sign this thing, when in time it will all have to go anyway. It will be only a few years when it will be foreclosed.’ ‘Well,’ he says, ‘that is all right. I promised Mr. Buhl you would sign that thing, and you have’ got to sign it.’ I was afraid to say anything to him, and I never talked backed to him at all, because I didn’t dare to; and we got down.. He hitched the horse in front of the post-office, and walked up, and I never said anything until I got to Mr. Harmon’s office. Mr. Harmon went in the other room, and got the papers, and brought them out, and laid' them on the table, and he says, ‘You sign right here.’ “Q. Who said that? “A. Mr. Harmon. And father said right after him, ‘That’s right, sign it right there.’ But I says, ‘Wait a moment; I would like to read this.’ And he [father] said: ‘ There is no damn use in your trying to read this thing. You can’t make head or tail of it.’ Mr. Harmon says, ‘ That is right; let him read it,’ and I picked it up, and started to read it. While I was there, he [father] got a little nervous-acting, and walked up and down the room, swinging his arms; and I could not make anything out of the paper; and I finally got disgusted, and threw it down on the table. He [father] says, ‘Are you ready to sign it ? ’ and I was thinking at the time whether I had better or not. Well, I thought the only thing to keep peace in the family was to sign it, and be done with it, so I did it, through fear of having an awful rumpus if I did not.” He also testified that he signed the second mortgage under coercion from his father. On cross-examinatioil he stated that he knew this second mortgage was to take the place of the prior one, and that the second mortgage was to run five years, and'-that he told his father it was a — 167 — foolish arrangement. He also knew the amount was $100,000, and that the bank had agreed to postpone the payment for five years by the giving of this mortgage; and he stated, “The main reason I signed it was to keep peace in the family.” Ralph, after detailing what took place between himself and his father, his father’s threats of turning himself and wife out of doors, says that he then consulted Mr. Howard (an attorney in Detroit); that he consulted him a number of times about signing the mortgage; and that Mr. Howard advised him to sign it for the sake of peace in the family, and told him that, if he did sign it, he (Howard) thereafter would have it set aside. Witness further testified, “I signed it altogether on Mr. Howard’s advice.” Both Charles and Ralph admit that they knew this money went into the building of the terrace, the title of which was in their mother and her children. Prior to the time this testimony was given, the elder Blodgett had died. It appears, however, that he had obtained these moneys from the bank, and had expended them upon property belonging to his wife and children. It may have been, and undoubtedly was, an unwise undertaking, as it jeopardized the whole property, his own as well as that belonging to his wife and children. When he received the money, it was with the understanding that the children who were then under age would sign the mortgage when they became of age. When Charles came of age, he signed the first mortgage. The circumstances under which he claims to have signed it have been set out. He signed the second mortgage about a year later, when he was nearly 22 years of age. He knew then what it was for, but claims that he was again coerced; that he signed it under duress; but he knew the time for payment was being extended five years by his signing this mortgage, and he says he signed it.to keep peace in the family. As .to Ralph, his statement was that he signed the mortgage because Mr. Howard advised it. — 168 — We think no duress is shown which should avoid these mortgages. It is true that courts of equity grant relief in many cases where there is no legal duress in the strict acceptation of the term, and where the wronged party would perhaps be remediless at the common law; or, as stated in 2 Pom. Eq. Jur. § 951: “Where there is no coercion amounting to duress, but a transaction is the result of a moral, social, or domestic force exerted upon a party, controlling the free action of his will, and preventing any true consent, equity may relieve against the transaction on the ground of undue influence, even though there may be no.invalidity at law.” The rule is stated by Mr. Justice Story in his work on Equity Jurisprudence (section 239), that: “Where a person does an act or makes a contract when he is under duress, or the influence of extreme terror, or of threats, or of apprehensions short of duress, he may be relieved in equity, for in cases of this sort he has no free will, but stands in vinculisj and the constant rule in equity is that where a party is not a free agent, and is not equal to protecting himself, the court will protect him. * * * Circumstances, also, of extreme necessity and distress of the party, although not accompanied by any direct restraint or duress, may, in like manner, so entirely overcome his free agency as.to justify the court in setting aside a contract made by him, on account of some oppression or fraudulent advantage or imposition attendant upon it.” There can be no contention as to what the general rule is. The only difficulty is in applying it. It is a question which must be determined by the facts of each case. 6 Am. & Eng. Enc. Law, p. 81, § 16. But this much is settled by all the cases: That the duress or undue influence must be such as would overcome the will of a-person of ordinary firmness. Buchanan v. Sahlein, 9 Mo. App. 552; Seymour v. Prescott, 69 Me. 376. If the rule of those cases be applied to the present one, it is clear that the defendants have made no such showing as entitles them to be relieved from the operation of these mortgages. Charles executed the second mortgage when nearly 22 — 169 — years of age. He had already executed one before that, after arriving at his majority; and the mere fact that he executed this second mortgage to keep peace in the family does not show such duress or undue influence as to warrant the discharge of such a lien upon his interest in the premises, when the very fund for which it was given went into his own property for its betterment. The case of Ralph is clearer still. He did not execute the mortgage simply because of the influence which his father had over him, but upon the advice of his friend and adviser, and with the understanding that that adviser could have the mortgage set aside by raising the question of duress when he was ready to move in the matter. The court very properly held that this was no defense to the mortgages. The decree below must be affirmed. The other Justices concurred.