44 N.J. Eq. 93 | New York Court of Chancery | 1888
The complainant files a bill to foreclose a mortgage which was given to him by the defendants to secure the payment of a bond given by the defendant, Mr. Johnston, to the complainant, conditioned for the payment of $6,432.02. Mrs. Johnston files her answer, and resists the foreclosure of this mortgage, upon the ground that she was induced to join with her husband in executing this mortgage upon her separate estate by unlawful influences, threats of the imprisonment of her husband, the real debtor, and other fraudulent practices, upon the part of the complainant, amounting to undue pressure.
Mr. Johnston was the executor of his father-in-law’s will; the complainant, Mr. Lomerson, became one of his sureties for the performance of the trust. In the progress of the settlement of the estate, Mr. Johnston gave to the complainant two bonds, one
At the time of the execution of this mortgage, Mr. Johnston was about seventy-six years of age, and was feeble in health. However, there is nothing to show that he was feeble in mind, or in any way broken down physically. He was not only about the premises at the time, but he called upon the attorney, who prepared the mortgage on the day it was prepared; but whether he asked him to prepare it or not does not appear. Mrs. Johnston, who was well advanced in years, had suffered a good deal of anxiety because of business troubles in the family, and because of the loss of three of her children. But there is nothing in the appearance of Mrs. Johnston upon the witness stand, nor in her expressions as a witness, which would indicate any incapacity upon her part to understand ordinary business transactions and the reasonable effects to flow therefrom. It will be seen that I must come to this conclusion with respect to Mrs. Johnston, who testifies in her own behalf, in order to give any very great efficacy to her statements as a witness. She says that Mr. Lomerson came to her house, and said that he wanted her to give a mortgage as collateral security for the payment of this $6,400, this being the amount of money due to persons known as the Hornbacker heirs. She inquired who wanted her to give this mortgage, and Mr. Lomerson said they were Mr. Ship-man, who was a prominent lawyer in the village, and a warm friend of Mrs. Johnston’s, and a Mr. McMurtrie, who might be called upon as surety. She replied that she could not do it, and asked Mr. Lomerson if he wanted to send her to the poorhouse. She says Mr. Lomerson then said, “ If you don’t, Levi will go to jail.” She inquired who would put him there, and Lomerson said Mr. Shipman would. At this instant, her daughter
Mr. Lomerson says, in speaking upon the subject of this interview, that he told Mrs. Johnston and her daughter that Mr. McMurtrie said that, unless she gave a mortgage on her lot, he would see her husband go to jail, before he would pay a dollar
While the principal contention is with respect to the question whether there was in contemplation of law a contract or not which could be enforced, it is due to the defendants to notice another point earnestly presented, which is to the effect that if this mortgage was not obtained by duress or false representations amounting to a fraud, under any other circumstances which prevented Mrs. Johnston from acting as a free and voluntary agent, it, 'nevertheless, cannot be enforced because it is without any new consideration. It was given by the wife upon her separate estate, to secure the pre-existing debt of the husband, and is, therefore, void. Reliance is placed upon the law as laid down in Brandt on Surety § 9, and Jones on Mort. §§ 615, 1137, and the case of Pratt v. Hedden, 121 Mass. 116, 121, and Ellis v. Clark, 110 Mass. 389, 392.
I do not think a new and distinct consideration has been made requisite in such cases in this state. When the following cases are carefully considered, I think it cannot be claimed that they recognize any such doctrine. Merchant v. Thompson, 7 Stew. Eq.
We come now to the consideration of the main question, which is, does enough appear by way of proof in this case to satisfy the judicial mind that Mrs. Johnston was so influenced, by what was said by Mr. Lomerson, as to deprive her of her free agency in the making of this mortgage ? There is no dispute but that the criminal liability of Mr. Johnston, the husband, was spoken of by Mr. Lomerson. He admits saying that Mr. McMurtrie had said he would see Mr. Johnston in jail before he would pay one dollar of his claim, unless Mrs. Johnston executed this mortgage. He admits, further, saying that when Mrs. Johnston asked if that could be done, that he said it could, and called her attention to the fact that persons had been put to jail for the wrongful use of trust funds. Now, the moneys which it was sought to secure by mortgaging her lot were trust moneys. Mrs. Johnston was apprised of this fact'. It was very well understood that Mr. Johnston was greatly in arrears in his payments, and was wholly unable to pay out of his own estate. The two bonds and mortgages, which had previously been given to secure the same moneys, were thought, at the time, to be inadequate, although that fact had not been practically determined, at the time of the execution of this mortgage, by a foreclosure and sale. The conclusion cannot be overcome, that, considering her age, and the condition of the health of her husband, but that she might have some reasonable apprehensions of disaster to him because of his financial embarrassments. The insistment of Mr. Lomerson that he made no threats directly, when he admits saying that he gave the incidents which I have named, affords no excuse or palliation. If the statements which he made, to the effect that Mr. Johnston had been guilty of embezzlement, and to the further fact, upon inquiry by Mrs. Johnston, that for such embezzlement he was liable to be imprisoned ; and that he was aware of the fact that several persons
There are several cases in our own reports which throw some light upon this subject, although I believe none of them go further than to lay down general principles, which are always of the utmost value in such cases, such as Remington v. Wright, 12 Vr. 48; S. C., 14 Vr. 451; De Ronge v. Elliott, 8 C. E. Gr. 486; Tooker v. Sloan, 3 Stew. Eq. 394.
The case of Williams v. Bayley, L. R. (1 H. L.) 200 (also, 35 L. J. Ch. 717), considered in the House of Lords, is of great interest. In that case, a father had endorsed for his son, after which the son forged numerous endorsements. At length, the ■holders of the paper, being bankers, pressed the father for a settlement. There was no proof that the father had ever sanctioned the forgeries, or in any way countenanced the unlawful transactions of the son. The holders of the pape)’, in fact, said to the father, “We don’t know these to be forgeries — we don’t believe them to be so; but your son is responsible for them, and if you don’t help him, we must sue him for the •amount.” They did not say in direct words that the son was guilty of forgery, and that they should prosecute, and would enforce the penalties of the law. They must have believed they were forgeries; but they said, “We do not wish' to exercise pressure on you, if it can be satisfactorily arranged; ” and the inquiry, “What is the meaning of that?” The inquiry was, Does the word “pressure” mean pressure arising from exercising the power or keeping .in the hands of the holders of this paper, the means of exercising the power of instituting a criminal prosecution ? Or does it mean the pressure of getting you to make‘yourself responsible for your son’s debt? ■ It must have meant the former, because the context shows that the other was alternatively provided for when it was said, “We do not wish to exercise pressure, if it can be satisfactorily arranged.” That could not mean, “ If you take upon yourself without pressure, we do not mean to press you. 'If you can
A case involving the same principles was considered in the New York court of errors and appeals. Eadie v. Slimmon, 26 N. Y. 9. The action was to recover $2,000 on a life insurance policy. It appeared that on the 4th day of April, 1857, Slimmon went to the house of Mr. Eadie with an attorney, a person whom he represented to be a police officer, and another person,, and there accused Eadie of having embezzled money while in his employment as a clerk. An altercation ensued between them as to the’ amount of Eadie’s indebtedness. Slimmon demanded that Eadie should convey to him his house, and cause the policy of insurance upon his life, held by Mrs. Eadie, to be assigned to him, in payment or security for the alleged indebtedness. The discussion lasted some hours. Mrs. Eadie was either present or near by all the while. Slimmon threatened that, if Eadie would not comply with his demands, he-
“Within the principle asserted in these cases, the present case presents, I think, an instance of a contract procured by undue influence, if one ever existed. The assignment from the plaintiff to the defendant was most clearly extorted by a species of force, terrorism and coercion which overcame free agency; in which fear sought security in concession to threats and to apprehensions of injury. It was made as the only way of escape from a sort of moral duress more distressing than any fear of bodily injury or physical constraint.” The testimony shows that Eadie himself refused, and that Slimmon told him “that if he did not, as sure as the sun rose, he would lodge him in yonder jail to-morrow; he had an officer down stairs for that purpose.” Many other similar observations were made by Slimmon. The court said : “ I can imagine no duress over a man — no restraint over his person, or dread of personal injury — -more likely to deprive him of free agency, and induce him to yield to the wishes and demands of another, than the duress over this woman, operating through appeals thus addressed to her pride, her fears, her affections and her sensibilities.”
The principle upon which the court of equity proceeds in these cases seems to be further illustrated by that of Rau v. Von, Zedlitz, 132 Mass. 164. The suit was in equity. The bill alleged that the defendant was indebted upon two drafts accepted by her at Dresden on the day previous to her marriage, and seeks to obtain a decree that the trustee of the marriage settlement shall apply to the payment of the drafts, so much of the trust fund as is necessary. The defence is that the acceptance of the drafts Avas forced upon her by threats and undue influence, and is invalid. It seems that the defendant whilst traveling in Europe became engaged to be married. She possessed considerable fortune in her own right, and a marriage settlement Avas prepared at her request. Her intended husband Avas largely indebted to the plaintiff, and there was some evidence that portions of the money had been advanced by the plaintiff; and the defendant was induced to go to the office of a notary public to make some
The same principles are announced in Lyon v. Tallmadge, 14 Johns. 501, 518; Lamplugh v. Cox, 1 Dick. 411; Davies v. London and Provincial Ins. Co., L. R. (8 Ch. Div.) 469; Sharon v. Gager, 46 Conn. 189; Reed v. Exum, 84 N. C. 430; Singer Mfg. Co. v. Rawson, 50 Iowa 634; Thurman v. Burt, 53 Ill. 129; Har
So far as I have observed in no one of the cases which I have considered up to this point has the instrument alleged to have been procured by oppression been solemnized by an acknowledgment of its free and voluntary execution, according to the statute in such case made and provided, by a public officer authorized to take such acknowledgment, except that of Sharon v. Gager. We are not, however, left without the aid of a judicial examination of the subject with such an important fact in the case. In Central Bank of Frederick v. Copeland, 18 Md. 305, the court was called upon to deal with the subject thus presented. The mortgage was given by Copeland and his wife upon the real estate of the wife. There was an acknowledgment and separate examination of the wife duly certified by the officer authorized to take such acknowledgments. Upon proceedings to foreclose, a decree pro confesso was taken against the husband. Mrs. Copeland, under leave, answered separately, showing that, at the time of the execution of the paper, she was in bed and suffering from a severe spell of sickness, and was weakened and much reduced by nervous prostration; and that, whilst in such a state of physical debility, she, was forced to sign the paper in the presence of her husband by means of threats and menaces which she was unable to resist, and that the means used were fraudulent. The court find these allegations to be true, and say: “ The execution of the mortgage was preceded by personal menaces and threats of her husband to destroy the property by fire, if she did not execute it, and the fact that it was executed and acknowledged involuntarily, as a consequence, cannot be doubted. The resort to measures thus violent and harsh, leads irresistibly to the conclusion, that'her consent could not have been obtained otherwise. Her acknowledgment, that it was free and voluntary, and not induced by fear, as between the parties to the deed, is not. conclusive of the fact that it was so, nor can it, with due regard to the evidence in the case, be so considered. * * * A husband, who, by extreme harshness, compels a wife to execute a deed of her property against her will, and then, in the form pre
In the case of Sharon v. Gager, supra, the treasurer of a town became a defaulter, and the selectmen of the town urged an aunt of this treasurer to secure the amount due by a mortgage on her lands. She had lived with the nephew for many years and was greatly attached to him. An agent of the selectmen said to her, “You know what the consequence is — it is $500 fine and imprisonment.” The aunt executed and acknowledged a mortgage on her real estate. The court held that she could avoid it.
In McCandless v. Engle, 51 Pa. St. 309, the court said: “Less than actual duress will avoid an acknowledgment of deed of conveyance or mortgage by a wife, provided it be known to the party claiming through it. * * * It is enough if it be shown that the wife did it under moral constraint, that is by threats, persecution and harshness of her husband to force her to set aside her own free will.” Michener v. Cavender, 38 Pa. St. 334; Louden v. Blythe, 16 Pa. St. 532; Harris v. Carmody, 131 Mass. 51.
The ease of Remington v. Wright, supra, is not in conflict with the views of the learned judges expressed in the cases cited, otherwise than is so frequently the conflict between cases at law and in equity, which conflict is the principal seat or throne of equity. And this distinction is fully recognized by Mr. Justice Reed, who delivered the opinion in the last-named case.
Therefore, it is plain, that pressure which does not amount to duress at common law, may be considered, in equity, as sufficient
And, that the undoubted statement of facts in the case before me bring it within these principles, requires but little argument. Mr. Lomerson demanded the mortgage of Mrs. Johnston to secure the debt of her husband, and informed her of the criminal liability of her husband. Now, Mrs. Johnston and her daughter both swear that Mr. Lomerson said that proceedings had already been begun by those interested, against her husband. This, Mr. Lomerson denies. Now, while he may not have so expressed himself, it is quite impossible for me to believe that some allusion was not made to proceedings pending or anticipated. Persons so little acquainted with court transactions would not be likely to manufacture such statements, however much they might become confused in the repetition of such statements. But, at all events, the question of criminal liability must have been introduced by Mr. Lomerson, and it must have been for a purpose, and that purpose must have been to get Mrs. Johnston to join in the mortgage. He went there for that purpose, and he made, as his own testimony most clearly shows, the very most of the fact, in order to produce the desired effect on her mind. I can conceive of nothing, in such cases, more likely to overcome free agency.
I think the defendant is entitled to the benefit of her defence, and that the bill of complaint should be dismissed, with costs.