McCollum v. Boughton

Barclay, J. The petition is in ejectment for certain lots in the town of Dexter, Stoddard county, Mo. It follows the usual statutory form, and lays the ouster, September 21, 1890. The answer denies the petition, in general terms, and then sets up a defensive state of facts, which will be discussed further along. The plaintiff filed a reply bringing into the case more new matter, the nature of which will soon appear. A trial came on in due course, resulting in a finding and judgment for plaintiff, from which defendant appealed, after the usual motions and exceptions to preserve her rights for review. The defendant was the owner of the property in suit when the deed of trust upon whose effect this appeal must turn was given. As she charges in her answer, and the evidence of both parties shows, she is a married woman, and was such at all the dates men — 608 — tioned in the case. The property belonged to “her general estate,” as the plaintiff’s evidence disclosed. The deed of trust which she and her husband executed, August 24, 1888, was duly acknowledged by both of them. In August, 1890, Mr. Boughton disappeared, and the note described in the deed of trust was not paid at maturity. The trustee, Mr. Ladd, after the usual preliminaries, put up the property to be sold, in conformity to the deed, to meet the demands of the trust, September 19, 1890. The land was bid in for $1,691.40 by an attorney representing the plaintiff as well as Messrs. Ulen & Malone. These three made such an adjustment of the matter between themselves, that the trustee’s deed, September 20,1890, was finally made to Mr. McCollum, the present plaintiff, who was. also one of the signers of the note secured. The defense stated in the answer is based upon these facts, somewhat elaborated. Defendant’s contention is that plaintiff and the other signers of the note are primarily liable, and that they should respond for the debb which the note represents before her estate can be held for it. The plaintiff meets this claim with a charge in his-reply that he and all the signers of the note, except Mr. Boughton, were merely sureties for the latter, and that it was expressly agreed between Mr. Boughton and them, before the note was signed, that they were not to be liable until the security afforded by the deed of trust was exhausted. Other matters are sated in the reply, but, in the view we take of the admitted facts it will not be necessary to go further into the particulars of the pleadings. At the hearing on the circuit, the court, over defendant’s objection and exception, admitted proof that plaintiff and the last three signers of the note executed it as sureties for Mr. Boughton, and upon the — 609 — faith of the deed of trust which had been prepared before the note was actually executed.' But no-person testified or asserted that Mrs. Bough-ton, the defendant, was even present when Mr. Bough-ton made the agreement to stand as primary debtor, as between the note signers, or that she ever made any such agreement to that effect herself with plaintiff, or with her husband, or with any of the signers of the note, other than as appears in the deed of trust. It may be assumed. that the evidence tends to prove that defendant knew that the money represented by the note was borrowed and used by Mr. Boughton alone. The question then is, what are the relations between Mrs. Boughton and the plaintiff, as one of the makers of the note, touching liability for this debt, on the facts above disclosed. On the face of the deed of trust, the land of Mrs. Boughton was pledged to secure payment of the note,, as described in that instrument. The land was part-of # defendant’s “general estate,” as her counsel describe it,'or of her “legal estate,” as plaintiff’s-counsel assert. No claim is made that the land was her separate-state, though the date of its acq uisition by her is not clearly given. Whatever the nature of her estate, it is not claimed that she entered into any agreement that affects her rights touching the .subject-matter of this suit, other than the one embodied in the deed of trust, even if she had power to make such an agreement. Her land, by virtue of that deed, was pledged as a security, to be resorted to. if said promissory note should “be allowed to remain due and unpaid.” Hagerman v. Sutton (1887) 91 Mo. 519 (4 S. W. Rep. 73); — 610 — Barrett v. Davis (1891) 104 Mo. 549 (16 S. W. Rep. 377). But in the note all the signers were ostensibly principals; and, as between the defendant’s land and the makers of the note,.the latter were primarily liable, according to the deed of trust. It may be conceded that, as between Mr. Bough-ton and the other signers of the note, he was primarily liable, and that they were merely sureties, by reason of their agreement to that effect at the time of giving the note. But that relation between the signers of the note did not necessarily change the order of liability between them as the makers of the note (whether as principal or sureties) and the defendant, as the owner of the land pledged as security for the payment of the note, without other stipulations than those contained in the deed of trust. Mr. Boughton was not authorized merely by reason of his marital relation to defendant, to enter into other agreements on her behalf altering her liability as expressed'in the deed of trust. Wilcox v. Todd (1877) 64 Mo. 388; Henry v. Sneed (1889) 99 Mo. 407 (12 S. W. Rep. 663). No other authority or agency on his part to speak for her on that topic is even suggested. She may have known that her husband was in fact principal and the others sureties upon the note. But it is entirely competent for one person to become surety for another surety, or to limit the extent or ■sequence of his liability with respect to other sureties. Such agreements will be enforced as made. The true test of liability in these cases is the intent ■of the parties, as indicated by their mutual agreements. McNeilly v. Patchin (1856) 23 Mo. 40. Here the •defendant’s attitude toward the parties who signed the note is defined by the deed of trust. Whatever be the — 611 — relations of those signers to each other, there can be no substantial doubt that the relation of the defendant’s land to the note, as it stands, is that of surety for the payment of the note. See the Hagerman and Barrett cases above cited. In Harris v. Warner (1835) 13 Wend. 400, one signed a note as “surety for the above names,” following four other signatures, to three of which the word “surety” was added, while the other (that of the principal) stood alone; and it was held that the last signing surety was not bound with those whose names preceded his, but that he was liable only after them. That ruling was afterwards followed in the same state by Sayles v. Sims (1878) 73 N. Y. 551. Many other cases illustrate the same principle. Craythorne v. Swinburne (1807) 14 Ves. 160; Dawson v. Pettway (1839) 4 Dev. & B. 396; Sherman v. Black (1876) 49 Vt. 198; Moffitt v. Roche (1881) 77 Ind. 48; Baldwin v. Fleming (1883) 90 Ind. 177. It is wholly immaterial, in view of the terms of the deed of trust, that defendant was aware that her husband was the primary debtor, as between him and the other signers of the note. It was competent for her, with such Knowledge, to pledge her estate as surety for their payment of the note, even in the capacity of sureties for her husband, as principal, which the instrument executed by her in effect did. Chapeze v. Young, (1888) 87 Ky. 476 (9 S. W. Rep. 399). Whether the case be viewed as legal or equitable in its nature, it is very clear that no person liable on the note can compel payment of the note from the land pledged only to respond for the debt in event the note should not be paid, according to its promise. Freeman v. Moffitt (1893) 119 Mo. 280 (25 S. W. Rep. 87). By the terms of the deed of trust, the plaintiff is liable — 612 — to answer for the debt represented by the note, before the land can be resorted to for payment. On the facts established by plaintiff’s own evidence, the learned trial court should have found for the defendant, under the law as contained in the first instruction asked by her. It committed error in not so finding; and it is wholly unnecessary to consider any question as to the form in which the case was dealt with on the circuit. The judgment is reversed, and the cause remanded, with directions to enter judgment for defendant. Macearlane and Robinson, JJ., concur; but Brace, C. J., dissents. in .banc. Barclay, J. Since the transfer of this cause to the court in banc we have been favored with an opinion of our learned brother Gantt upon which he would reach a judgment affirming that of the circuit court. His comments on the case seem to call for a few remarks supplemental to the opinion delivered May 14, 1895, in the first division (30 S. W. Rep. 1028). Our learned brother advances the proposition that Mrs. Boughton and the plaintiff should both be treated as sureties for Mr. Boughton, her husband. That opinion is based upon two distinct grounds, if we correctly analyze the reasoning: first, that the legal effect of the instruments was to make her a surety for her husband; and, secondly, that ‘ £it was entirely competent to receive parol evidence of the collateral contract between Boughton and the plaintiff, McCollum, Ulen, and Malone, that they were only sureties for Boughton.” We will examine each of these grounds. 1. By the terms of the deed of trust Mrs. Bough-ton was, no doubt, surety for her husband, as he was — 613 — one of the signers of the secured note. But that proposition is stated, and used, as though she became surety for her husband only, and not surety for the note with its other signers besides her husband. According to the deed, her land became bound for the payment of the note by those whose promise to pay it contains, namely, the four makers, of whom Mr. Boughton was but one. If (as my brother G-antt appears to intimate) the deed of trust made her surety for her husband only, then the conclusion he points out might follow. But that interpretation of the deed is erroneous. The error, too, is a radical one. It vitiates the whole argument that our learned brother has founded upon it. The decision cited to confirm it (Wilcox v. Todd, 64 Mo. 388) deals with a case in which a husband (alone) borrowed money, and, to. secure his debt, he and his wife joined in a deed of trust conveying a piece of land belonging to the wife, as well as another piece belonging to the husband: it was held that she was surety for her husband as to her piece of land so conveyed. That case falls far short of deciding that the legal effect of the instruments (namely, the note and deed of trust in this case) was to make her a surety for her husband, if by that statement the husband alone is meant. The effect of those instruments seems to us quite different. The principle declared in the very precedent cited sustains the conclusion we would reach on the present appeal, provided we are right in interpreting those instruments to mean this: that Mrs. Boughton conveyed her legal estate to secure payment of the note by its signers. If, as to her, all the makers of the note are primarily liable, and her land is security for the debt represented by the note (which all of them signed), then — 614 — it must follow that no one of the makers of the note can eject her from the land by a title obtained through that very deed of trust. The crucial question then is, what is the correct meaning of the deed of trust?. Did it bind Mrs. Boughton’s land to secure the debt of Mr. Boughton, or the debt of all the makers of the note? Can there be any reasonable doubt that, on the face of that instrument, the land is conveyed in trust to secure payment of the note, and the note is recited as signed byfour persons, of whom plaintiff is one andMr. Boughton another? How then can it be properly held that all the signers of the note are not primarily liable, as against the land conveyed to secure it, when the terms of the deed make no distinction whatever between them in respect of their liability as makers? So far as appears from the note and deed of trust all the makers of the note are principals. Its language is “we promise to pay,” and all sign that promise. What rule of law justifies the holding that only one of these makers is the principal, and that the others are only sureties for that one, assuming now that we stick to the construction of the paper itself? No word or suggestion in the deed of trust is-pointed out to sustain the position that, on the face of that instrument, its legal effect was to make Mrs. Boughton’s land any more a security for her husband than for the other signers of the note. That effect could be given it only if the law were such that she might mortgage her land to secure a debt of her husband, but not to secure the debt of anyone else. But there is no such distinction recognized by the law of Missouri. If a wife, at the time of the deed in question (1888), joined her husband in a conveyance of her legal estate, in the manner prescribed by the statute touching such instruments (R. S. 1879, sec. 669), the — 615 — conveyance could as validly secure a debt of a third party as a debt of her husband. That proposition was assumed as the basis for the judgment reached in Rines v. Mansfield (1888) 96 Mo. 394 (9 S. W. Rep. 724), and there can be no doubt that it is a sound statement of the law in force in 1888. There was nothing in our statute law at that time to forbid Mr. and Mrs. Boughton from mortgaging her land to secure the debt of third persons any more than there was to prevent them from mortgaging it to secure a debt of her husband. That they might mortgage it, in proper form, for the latter purpose, is settled in this state. Hence we consider that, by the deed of trust, Mrs. Boughton bound her land as security to respond to the promise of the note as it stands; but not to respond for one only of the makers of that note. 2. We then come to the other contention, as to the admissibility of oral evidence, in such a case as this, to show that (as between themselves) Mr. Bough-ton was the principal debtor and the other signers of the note were his sureties. My brother Gantt holds that it “was entirely competent” to receive such evidence, as against the defendant. We respectfully differ from that declaration. We have nothing to do now with the question of the competency or relevancy of such evidence in a controversy between the parties to the note; and the discussion of such a question would be wholly foreign to the issues in the actual case in hand. If on the face of the deed of trust Mrs. Boughton’s land was security, and all the makers of the note were principals, that sequence in the order of liability could not be broken by oral evidence, as against her. The deed of trust was made in 1888, and her rights thereunder were then fixed. The property was not her — 616 — separate estate. She could only bind her legal estate by the methods sanctioned by the law. Her rights and liabilities under the deed of trust were measured by its terms. They can not properly be enlarged as to her, by oral evidence to the effect that some of those .who are stated in the deed of trust to be makers of the note are in reality (as between themselves) only sureties. As against the rights of a married woman to her legal estate such evidence is plainly inadmissible in this state. That rule of law is so well settled in Missouri by prior decisions that it is not necessary to do more than to refer to a few of them. Shroyer v. Nickell (1874) 55 Mo. 264; Hagerman v. Sutton (1887) 91 Mo. 519 (4 S. W. Rep. 73); Gwin v. Smurr (1890) 101 Mo. 550 (14 S. W. Rep. 731); Meads v. Hutchinson (1892) 111 Mo. 620 (19 S. W. Rep. 1111). The plaintiff’s case, therefore, must at last be brought to book upon the interpretation of the deed of trust. In our opinion, with all due respect to the views of our dissenting brethren, when we reach that point the result, that should follow seems very plain. All the signers of the note are primarily liable to pay it before resorting to the wife’s legal-estate, conveyed to secure that note as described in the deed of trust. ■We hold that the conclusion reached in the first division should not be disturbed; and, approving the opinion there delivered, we direct that the circuit judgment be reversed and the cause remanded as then ordered. Brace, C. J., and Uantt and Burgess, JJ., dissent. Macearlane, Sherwood and Bobinson, JJ., concur.