128 S.W.2d 357 | Ark. | 1939
Holman was adjudged a bankrupt, and he applied to Kirby to buy for him a part of the land he had previously owned. Kirby agreed to do so, and Holman negotiated a sale with the trustee in bankruptcy whereby a deed was made to Kirby for the consideration of $168, which Kirby paid. This fact is undisputed. But Kirby testified that the understanding was that he would allow Holman only 30 to 60 days to repay the money advanced. Holman denied there was any such limitation of time, and the undisputed testimony is to the effect that nearly a year after the purchase of the land Holman offered to pay a portion of the purchase money, but was told by Kirby to wait until he could pay it all.
The land bought by Kirby had forfeited to the state for the nonpayment of taxes, and the discovery of this fact, which was unknown to Kirby when he bought the land, appears to be the circumstance which determined Kirby not to accept the tender which Holman later made. *328 Kirby had the impression that Holman was endeavoring to buy the land from the state and thus acquire the title, and witnesses testified that Kirby said he had bought the land from the state and had "beaten Holman to it," and that he would just keep the land.
The litigation began when Kirby filed suit to enjoin Holman from interfering with his possession, and, by appropriate pleadings, the issue was joined whether Kirby had acquired title for the use and benefit of Holman, whose cross-complaint, containing that allegation, was dismissed as being without equity. From the decree quieting Kirby's title is this appeal.
The essential facts in this case are identical with those in the case of Strasner v. Carroll,
This case is distinguishable from the recent case of Patton v. Randolph,
Here, the deed from the trustee to Kirby is absolute in form, but the testimony is to the effect that it was taken to secure the advance of money made by Kirby in the purchase of the land which was bought for the benefit of Holman, and the deed was his security for the repayment of the money. It was, therefore, in the nature of an equitable mortgage, taken in this form to secure the payment of a debt. There was not merely a parol contract to reconvey, as was true in the Patton Case, supra. Holman did not convey to Kirby, and there was no oral agreement to reconvey, which agreement would be within the statute of frauds. There was, in *330 effect, a loan, which the trustee's deed to Kirby secured, and the deed having been taken to secure a debt, it was, in legal effect, an equitable mortgage, and being a mortgage when executed, it continued so to be. Section 1193, Pomeroy's Equity Jurisprudence, Vol. 3 (4th Ed.), p. 2825.
The law as declared in the case of DeLoney v. Dillard,
The deed from the trustee to Kirby having been taken as security for the money advanced to buy the land, Kirby acquired no independent title by reason of the tax deeds procured by Kirby from the state. In the case of Cole v. Swift,
An actual tender was made in open court at the trial from which this appeal comes of a sum of money said to be sufficient to reimburse Kirby for the money advanced by him, with the interest thereon, and the taxes paid in purchasing the land from the state. Holman admitted that Kirby was to be paid "for his trouble." *331
Upon payment of all these amounts, a redemption should be permitted, and the decree will be reversed and the cause remanded, with directions to ascertain the total of all these items and to accord the right to redeem upon their payment.