167 Iowa 367 | Iowa | 1914
Prior to the year 1889 James Callanan and James C. Savery constituted a partnership under the firm name of Callanan & Savery, with their main office in the City of Des Moines. The firm was chiefly engaged in the handling of what were known, in this state, as swamp lands, having succeeded to the rights of what was known as the American Emigrant Company. Callanan was also engaged in handling lands on his own account, title to much of which was held by tax deeds. The firm and Callanan occupied the samé suite of rooms in a building in Des Moines, although they occupied separate rooms and kept their own .books. As a rule they had their own employees, save that some of them acted for both;
This scheme was immediately put into execution, and a warranty deed was drawn, signed by Callanan. and his wife, and an acknowledgment made of it as of date September 3, 1889. At or before the time the deed was sent to the recorder of Calhoun county, inquiries were made to ascertain whether or not the Mullens had recorded their deeds, and also as to whether or not they had sold either piece of the property. It was found that the deed to plaintiff was recorded, but that so. far as the record shows the property had not been sold by her, and so, without any actual delivery of the deed to Wiley, the grantee, this purported deed to him was placed of record. As soon as this was done, Shuck, representing either Callanan, or the firm, or both, wrote to the agent, Mallison, and asked him to secure a cancellation of the Mullen deed. Instead of telling him the truth, it was represented that the deed to plaintiff was made through mistake, in that through oversight they had sold and conveyed, by warranty deed, the same land some time before their negotiations with Mullen, and that he (Mallison) must help them out of the trouble, and get the Mullens to reconvey the land upon a return to them of the purchase money and something for their trouble. It was also suggested to him that, as the Mullens held only a quitclaim deed, a prior warranty deed, although unrecorded, would take precedence over their quitclaim and deprive them of their supposed title. Mallison conveyed this information to the Mullens and they immediately sought the advice of attorneys, and were advised by these lawyers that an unrecorded warranty deed would be superior to and take precedence over a subsequent quitclaim
One Brower was a local agent for Callanan and the firm, at Rockwell City, for the sale of Calhoun county lands, and in some way the Mullens learned that he had the property for sale, although they thought he (Brower) was representing Wiley. They went to Brower about buying the land in May of the year 1891, and after considerable negotiations they agreed to repurchase the lands for $11 and $11.50 per acre, upon condition that Brower would secure a loan for them upon the lands for $3,000. The loan was made and the balance of the consideration paid, and Callanan and wife again conveyed the land to plaintiff by warranty deed June 6,1891. The consideration named in the deed was, according to the record, $3,780. On the 9th day of June, 1891, two deeds, each purporting to have been made by John Wiley and wife to James Callanan, each dated May 1, and acknowledged May 29, 1891, for the land in controversy, went upon the records; the expressed consideration being in the aggregate $3,840. The Mullens did not know of these deeds at the time they made the last deal, and did not know that their deed came from James Callanan until some five- years after its execution, for the reason that it was taken and retained by the mortgagee of the land and. held by him-for' five years, and until the mortgage indebtedness was extinguished. The abstract of title also
As a matter of fact the original deed to Wiley was never delivered, and the reconveyances were made by him to Callanan simply to clear up the title. A significant fact in this connection is that, after the purported conveyance to Wiley, Callanan, on January 29,1890, wrote advising Wiley that some time before he had conveyed the lands to him for reasons not necessary to be stated, and that as the deed had accomplished its purpose he wanted Wiley and wife to execute a deed in blank, which was inclosed, purporting to reeonvey the property. This deed was evidently returned, but was not recorded, and, as negotiations were then pending for the resale of a part of the lands to the Mullens, he sent Wiley two deeds as a substitute for the previous one, in one of which plaintiff, Mullen, was named as grantee, and in the other he himself was the ostensible grantee. In the letter accompanying these latter deeds Callanan wrote Wiley:
As soon as I receive them, I will return you the old deed. This is all right. I did not want the party to know that I owned them. I told them the land belonged to you.
Wiley refused to comply with the request, and Callanan again wrote, urging compliance with the original suggestion. But this Wiley refused to do, although he and his wife did sign and return the two deeds, each of which named Callanan as grantee, which two deeds were recorded, as already stated, or the same day that the reconveyance to the plaintiff, Mullen, went on record. Callanan evidently forgot to return the first Wiley deed, and on August 4th, upon the suggestion of Wiley, Callanan returned the first deed, saying it had been forgotten, that he had never used it and had erased the name of grantors,
Plaintiff was not advised of the facts above stated, save as they participated therein, or of the alleged fraud, until Mr. Mullen, the husband, met the man Lawless, already referred to, in Des Moines shortly prior to the commencement of this suit. When the original conveyance was made, both Mr. and Mrs. Mullen believed that the deed to them was made in the form it was because it was claimed that Callanan held it under a tax title, and the firm as swamp lands. And they never knew until about the time this suit was brought that Callanan or any one else contended that he and he alone was the owner of the land, and that it was sold by mistake as Callanan & Savery’s land. When the matter was brought to their attention and they were asked to reconvey, it was not primarily because of mistake as to whether the land belonged to Callanan, or to Callanan & Savery, but because, no matter which owned it, it had theretofore been conveyed by warranty deed to Wiley, and for this reason, and this alone, they asked and demanded a reconveyance of the land, upon a return of the consideration and the amount expended by the Mullens for improvements. To this claim they (Mullens), on advice of counsel, were forced to yield, and they never had the matter of claimed mistake in the ownership as between Callanan, and the firm, Callanan & Savery, presented to them, nor did Callanan ever rely upon such a claim. His statement in that regard was simply one of the premises to his real claim that the land had previously been sold to another. Callanan studiously concealed the facts regarding the nature of the conveyance to Wiley down to the time of his death, which occurred about September 26, 1904, and no one would have known it, it seems, but for the disclosures made by Lawless just prior to the bringing, of this action. There was no reason why the Mullens should have questioned the Wiley deed. It was' regular on its face, properly acknowledged and recorded,
As already 'observed, Callanan to the last attempted to conceal the nature of the Wiley deed, and plaintiff did not know that the title stood in the" name of Callanan until about the year 1896, and at that time the records showed a reconveyance of the lands by Wiley to Callanan in May of the year 1891, as already indicated. These reconveyances did not, in themselves, cast any suspicion upon the original deed from Callanan to Wiley, which had been dated back, but which on its face was 'duly acknowledged and recorded. Had Callanan claimed a mistake as to the ownership of the land at the time of the original conveyance to plaintiff — that is, that it belonged to him and not to his firm — plaintiff would have had a right to contest that proposition both as a matter of fact and as to its sufficiency as a matter of law for rescinding the sale. But in the way it was put, of a previous sale by warranty deed to a stranger, there was no other recourse for her than to rescind and receive back her money. Even when she found that Wiley had thereafter made a reconveyance of the land to Callanan, there was nothing in that fact alone which would create any suspicion that the original deed to him was not genuine, and that it was not signed and acknowledged upon the dates stated therein.
The nature of this suit has already been sufficiently stated, and from the facts heretofore recited, about which there is little dispute, it is apparent that while plaintiff now owns the land, having title thereto, it should in equity be decreed to be in plaintiff from the time of the original conveyance to her, and that she should have returned to her all amounts she has paid for the property over and above the amount agreed to be paid as the original purchase price, unless it be for some of the defenses pleaded by the defendants.
Again, the mistake as to just who owned the land was a unilateral one, on the part of Callanan alone, and the deed was sufficient to carry, not only his individual interest, but also the interest of his firm in and to the land. Plaintiff had no knowledge of any mistake on the part of Callanan, or of Callanan & Savery, even if it be said that any mistake was made. Plaintiff needed a conveyance which would transfer the land to him, no matter whether title was based upon the swamp land grant or the tax title; and, as a matter of fact, when the original deal was made, Callanan did not have a •tax deed, but simply a certificate of sale. Mullen was informed from some source that the land would not be redeemed, and for this reason thought he should have a conveyance which would' cover the tax claim. But, as we have said, Callanan did not at that time have a complete title through his tax
But, however this may be, he did not attempt to do that, but, on the contrary, selected another ground, which, upon the face of it, was good, but which was conceived in fraud and covered with deceit. Having thus obtained a reconveyance, a court of equity will not permit him to entirely disregard his deceit and fraud on the theory that, if he had done something else, he might have secured the same results from the plaintiff. Plaintiff had the right to assume that Callanan was acting in good faith, and presenting truthful claims, and to govern herself accordingly; and, having succeeded in his schemes, a court of equity will not permit Callanan, now that he is brought to boob, to entirely change his grounds and take a new hold, presenting in defense a claim which he never made when he asked a rescission of the contract and a reconveyance of the property. Had he made the claim which is now made and plaintiff had acceded thereto, of course, there would be no case. But having concealed the claim, and made another untruthful one, on which plaintiff acted, he must be deemed to have waived and estopped himself from presenting any other — as much so as if he had secured the results at the end of litigation with plaintiff over the same subject-matter.
We think this issue is a moot one, and that the claim of mistake in the original transaction cannot now be litigated. The conveyance must be treated as good, save for the claim, made by Callanan at the time, that the land had previously been conveyed by warranty deed to Wiley. Plaintiff was not • bound, under any theory, to reconvey the land to Callanan. Had Callanan presented the matter of mistake now relied upon as a ground for rescission and a reconveyance, it was for plaintiff to say whether she would recognize it or not, and to liti-.. gate that claim, had she chosen to do so. Having put it upon another ground, and secured a reconveyance, that right passed.
The recording of the Wiley conveyance did not, as we think, amount to notice of the fraud. Piekenbrock v. Knoer, 136 Iowa, 534.
As a part of the relief, plaintiff was entitled to claim damages, without converting the action into one at law.
There was also a claim that the executors were trustees, and that for this reason the case was properly in equity. True, they were sought to be charged as such; but we need not decide as to whether or not the proofs sustain the allegations, for other grounds for equitable jurisdiction are shown.
There is testimony tending to show that a deliberate fraud upon the plaintiff was intended from the beginning, but we need do no more to demonstrate that an actual fraud was perpetrated than to recite the practically undisputed facts as heretofore set out. Appellants’ contention that, while a moral wrong was committed, there was no legal fraud, is not sound, either in law or in equity. We can hardly conceive of a more deliberate and reprehensible fraud than was here committed, and to say that it is not one of which equity will take cognizance is to affirm that a court of chancery is impotent and cannot exercise one of the powers for which it was created, to wit, to relieve against fraud and deceit.
The case has been ably argued, and we have gone over the record with great care, and find no reason for disturbing the decree in any respect.
Appellee’s motion to assess a penalty for taking the appeal is overruled, but the decree below is — Affirmed.