Action to determine adverse claims. The judgment was for defendant and plaintiffs appeal.
The facts are substantially these: Plaintiffs are husband and wife. The husband and his brother had been doing business for some time previous to September 18,1908, under the name of Staples & Staples, and during said time did the banking with defendant and borrowed from it the moneys needed in the business. On the date mentioned, plaintiffs executed and delivered to defendant a deed of their homestead, the title of which was in the husband, to secure a loan of $1,000, then madе to the husband for use in his business. At the same time, the defendant gave to plaintiffs a written defeasance, acknowledging and declaring “that the said conveyance was given and intended as collateral security for the payment of any indebtedness, liability or liabilities of the said Allen N. Staples to itself, the said East St. Paul State Bank, due or to become due, or which may hereafter be contracted or existing against the said Allen N. Staples.” And therein the defendant also agreed to reconvey by quitclaim the. premises named to said Allen N. Staples at any time upon his request “when all obligations have been fully paid and satisfied.” The note then given by Staples to evidence said loan has been renewed several times, and is unpaid. Sometime thereafter, a further loan of $1,000 was made, and the note evidencing the same was signed by Staples & Staples and by Allen N. Staples. This note has also been renewed, and remains unpaid, as does a similar note in form for $190, subsequently given upon a further loan.
The defendant in its answer alleged the foregоing facts, and averred that the deed was intended as a mortgage to secure the sums mentioned, but that through ignorance and mutual mistake the deed failed to comply in its wording with thе requirements of the mortgage xegistration tax law. It asked for reformation of the deed so as to
The errors assigned upon tbe reception and exclusion of testimony at tbe trial we are not required to consider, since no reference thеreto is made in appellant’s brief. Naeseth v. Hommedal,
Unaffected by tbe law referred to, tbe defendant has unquestionably a valid lien upon tbe. premises in controversy to tbe extent of tbe loan made when tbe deed was executed. And considering tbe terms of tbe defeasance above set out, we are also of the opiniоn that the trial court’s finding, that tbe subsequent advances were secured by tbe deed and were so intended by the parties, is fully sustained by tbe record. In short, tbe deed and defeasance mentioned constituted, in effect, a mortgage to secure tbe original loan and tbe loans thereafter made to tbe extent found by the court. It is said that, if this be correct as to the plaintiff Allen N. Staples, who negotiated for and received tbe future advances, the wife was not present when these were made, and there is no evidence that she knew thereof, hence her rights in tbe homestead cannot be affected thereby. Tbe wife executed tbe deed knowing its purpose, and tbe court was justified in finding that tbe defeasance mentioned was delivered to tbe plaintiffs. Knowledge must then be imputed to her that tbe deed was also to secure future loans which tbe defendant might make to her husband. Neither tbe circumstances surrounding the original transaction, nor tbe writings, contemplate that, as to tbe future advances, the wife should be consulted. She left the negotiations as to these, as well as. the one made, to her husband. Esty v. Cummings,
We come then to the effect of tbe mortgage registration tax law upon this transaction, chapter 328, p. 448, Laws 1907. Tbe here material provision reads: “No instrument relating to real estate shall be valid as security for any debt, unless tbe fact that it is so intended, and the amоunt of such debt are expressed therein.” In the deed in question, it is not stated that it was intended for security, and instead of tbe amount of tbe debt, we find only a nominal con
In applying this law, it is well to bear in mind that its apparently stringent provisions were not intended to change the law of contracts, except in so far as it becamе necessary to prescribe terms to be incorporated which would furnish information upon which the proper tax from every transaction could be secured. As said in First State Bank of Boyd v. Hayden,
It is further urged that, in order to reform an instrument, the evidence must be clear and strong that the parties agreed upon the terms which, by the decree, are to be substituted оr inserted, and therefore, while the court might hold that there was an agreement that the deed was given to secure a debt, and that the amount thereof was one thousand dоllars, there is no warrant for finding any amount in excess thereof, since no agreement as to the amount of the future loans was made when the deed was executed. We dо not believe the lgislature intended to prohibit mortgages for future advances or loans. Such transactions are of well recognized validity. Madigan v. Mead,
The attorney who drew thе papers was employed by the plaintiffs. ILe testified that the only direction as to the contents and purpose of the document, came from the plaintiff Allen N. Staples, and when these were prepared, his wife came with him to the attorney’s office, executed the deed, and at that time, the defeasance was shown to plаintiffs. Under these circumstances, it would be highly inequitable if a forfeiture of the defendant’s mortgage lien should be brought about through the procurement of plaintiffs, that is, by an unintea tional mistake of their attorney or scrivener.
Judgment affirmed.