Richards v. Harrison

Bond, J. In March, 1876, N. E. Eisher made a deed of trust to secure, two notes of $1,000 each, payable to A. W. Lee. In April, 1886, Lee borrowed $1,500 from J. W. Dodd, giving his note for that sum, and assigning the two notes of Eisher as collateral security. None of these notes were paid at maturity. Dodd caused a foreclosure of the deed of trust executed by Eisher on the twenty-eighth of November, 1887, and bid in the property at $1,275. Dodd then agreed that Lee might find a purchaser for the land and have .the benefit of any excess-over the amount due him (Dodd). In pursuance of this contract, Lee induced Byan and Wilson, as purchasers, to give him a set of three notes of $300 each, and another set of three notes of $500 each, and to execute two deeds of trust on said land, on the same date, one securing each set of notes. Thereupon Lee took the deed of trust covering the three $500 notes to the attorney of Dodd, and delivered said notes to him in part payment of Lee’s indebtedness to Dodd, and paid the remainder of such indebtedness in cash. Whereupon the attorney for Dodd directed the trustee in the Eisher deed of trust to make a deed to Byan and Wilson, and handed said deed and the deed of trust from Byan and Wilson securing the notes which had been received on Lee’s indebtedness to Dodd, to Lee, to be taken to the recorder’s office for record. When this transaction occurred Lee concealed [228] from Dodd and Inis attorney, that he, Lee, had another deed of trust from Ryan and Wilson. Lee went to the recorder’s office, filed for record the foreclosure deed to Ryan and Wilson, and instead of thereafter recording the trust deed from Ryan and Wilson securing the notes which he had delivered to Dodd, he withheld the same and placed on record the deed of trust from Ryan and Wilson to himself securing the $300 notes. Lee at once procured an abstract of the title to the land, as shown by the record, and with this showing went to Hannibal and sold the three $300 notes to plaintiff, indorsing them, waiving demand, notice and pi’otest, and stating to the broker who effected the sale, that they represented the unpaid purchase money upon a sale by him. of the land for $2,400, that the balance had been paid in cash. The abstract was dated two days prior to this transaction. When asked if anything had been done since the date of the abstract, Lee stated that he was just from Palmyra, and that1 ‘the abstract showed everything that was there. ” All these„ statements, made by Lee were reported by the broker to plaintiff, whereupon plaintiff purchased the notes and the broker gave his own check to Lee for the sum paid. This is an attachment suit against Lee as indorser of the notes waiving demand, notice and protest. The writ was levied upon real estate. A plea in abatement was filed by Lee. He having died before trial, the public administrator appeared and filed a plea in abatement. On the trial of this issue the court excluded plaintiff’s offer in evidence of the abstract of the attachment made and acknowledged by the sheriff and filed by the recorder of deeds, and admitted the finding of facts made in this court in the case of Dodd v. Lee, 57 Mo. App. 167. At the conclusion of the evidence the court sustained defendant’s demurrer and [229] directed a verdict in Ms favor. There "was a judgment for plaintiff on the merits. Plaintiff appealed to this court from the judgment on the plea in abatement. AsauTfoa“a!evidonee The waiver by Lee of demand, notice and protest of the notes dispensed with all the formalities necessary to charge him as indorser, and bound him unconditionally for their payment. Bank v. Lowe, 47 Mo. App. 151. As was adjudicated in the finding of this court when the facts were before it in a former case (57 Mo. App. 167) and as is abundantly shown in the present record, Lee was guilty of positive fraud in effecting the sale of the notes to plaintiff. True, he did not personally see the plaintiff, but the evidence is undisputed that he caused a falsification of the records as to the title to the land mortgaged for these notes, so as to procure an abstract showing title with which to deceive any one to whom he could sell the notes. This abstract, which contained in itself a false representation, he delivered to the broker, accompanying it with his own false representations, as to the amount of purchase money received by him for the land, and as to the state of the title. The abstract was shown to the plaintiff, to whom also the statements made by Lee were fully communicated. Upon this showing and these statements, plaintiff purchased the notes, only requiring Lee’s indorsement as aforesaid. In the transaction between plaintiff and Lee the broker was either the agent of one or the other of the parties, or the agent of both. If he was the agent of Lee, the latter was conclusively bound by the false representations which were made by his direction to effect the trade. If he was the agent of plaintiff, then Lee’s representations to him were made in legal effect to the principal (plaintiff). If he was the agent of both parties — as by consent a broker may be — then necessarily whatever [230] was said to him by one, was in the eye of the law a communication to the other. There is therefore no merit in the contention of respondent that the representations made by Lee were not made to plaintiff. It is also idle to argue, under the facts in this case, that plaintiff should have disbelieved the false abstract and false statements shown and reported to him, and made further inquiries. ' The abstract was fair and perfect on its face and ran the title down to two days before the trade. When questioned as to whether anything had happened in that short interval, Lee answered positively that nothing prejudicial to the title had taken place; that he was just from Palmyra, and that “the abstract showed all that there was there.” This positive statement by Lee of a known falsehood, or a thing which he did not know to be true, was a sufficient basis for plaintiff’s action, and excused him from further examination of the record. Pomeroy v. Benton, 57 Mo. 531; Wannell v. Kem, 57 Mo. 478; affirmed in Cottrill v. Krum, 100 Mo. 404; Bailey v. Smock, 61 Mo. 213; Goebell v. Troll, decided at present term. That Lee secured plaintiff’s money, making an unconditional promise at the time to repay it, by fraud and falsehood, is shown by all the facts and circumstances in the case. ^recorder\o’propva\idit“rd: [231] F“ad“ when. [230] It is further insisted by respondent that there was no valid levy of the attachment on the real estate, because after the sheriff made out a due and formal abstract of his levy and filed R with the recorder of deeds, the latter entered it of record on some book other than those used for land records. To create a complete levy of a writ of attachment, an abstract thereof must be made and filed with the recorder of deeds, to be by him recorded in the land records. R. S. 1889, sec. 543, paragraph 3; Bryant v. Duffy, 128 Mo. 18; Stanton v. [231] Bosschert, 104 Mo. 393. In the two cases cited the statute on this subject is construed and in each it is held that the officer’s levy is invalid, until he has filed such abstract with the recorder of deeds in the county where the land is situated. Having done this, his duty is discharged. The failure of the recorder to make proper record of the abstract is only material when there are other attaching creditors, or the rights of third parties have intervened. It can not affect the validity of the levy between the plaintiff and the defendant. In the ease at bar there are no intervening equities, and the levy made by the sheriff was just as operative against the defendant as if the abstract thereof had been properly recorded after it toas properly filed with the recorder. The whole purpose of the registration of land titles is for the protection of third persons. It adds nothing to the efficacy of the contract between the immediate parties. ■ A similar design prompted the enactment of the statute requiring the recording of an abstract of attachment upon real estate. Hence when such a levy is completed in the statutory mode, its operation between the immediate parties is just as effective before as after it is actually recorded. The last argument made by respondent in support of the ruling of the trial court is that the cause of action should be revived against the heirs of Lee. If there was any defect of parties, the respondent is not in a position to urge that objection in this court. No such defense was made by the pleadings, and it can not be urged for the first time on appeal. Frank v. City of St. Louis, 110 Mo. 516; Scott-Force Hat Co. v. Hombs, 127 Mo. 393; Loan Trust Co. v. Brown, 59 Mo. App. 461; Ellingston v. C. & A. R. R., 60 Mo. App. 679. Counsel for respondent insists that this rule does not prevail where the presence of the omitted parties is [232] necessary to the rendition of any judgment. The answer to this argument is, that there is nothing in this record showing that Lee owned the land at the time of his death. If he did not, of course, there was no necessity for the joinder of his heirs. If he did, then plaintiff will have an opportunity when this cause is remanded to bring in all necessary parties. Our conclusion is that the judgment must be reversed and the cause remanded. Judge Biggs concurs; Judge Bland absent.