72 Mo. 348 | Mo. | 1880
Lead Opinion
On the 25th day of May, 1872, Logan 0. Swope was the owner of block 24 of Peter Lin dell’s second addition to the city of St. Louis, incumbered by a deed of trust, by which said block was conveyed to Leffingwell to secure three promissory notes executed by said Swope to Robert C. Gordon, in the aggregate for the sum of $35,-839.95. Each of said notes was dated December 26th, 1871; one for $12,586.65, payable December 26th, 1872, one for $11,946.65, payable■ December 26th, 1873, and the other for $11,336.65, payable December 26th, 1874. On said 25th day of May, 1872, Swope sold and conveyed the said block to Henry H. Honoré for $80,000, subject to said trust deed to Leffingwell, and, by another agreement in writing of that date, Honoré obligated himself to Swope to pay off said notes secured by the deed of trust from Swope to Leffingwell. Honoré on the 27th day of May, 1872, executed a deed of trust to Ed. B. Sherzer, conveying said block to him in trust to secure two notes executed by said Honoré to Andrew McKinley, one for $10,040, the other for $4,000, dated 27th day of May, 1872, and payable three years after their date, and one for $3,000 to Logan O. Swope of same date, and payable three years after its date. This deed of trust from Honoré was, by its terms, subject to two prior deeds of trust made by Honoré, one to Edwin Sherzer, dated May 25th, 1872, to secure a note of that date for $18,500, payable to Swope, three years after its date ; the other deed of same date to same trustee, to secure a note of that date for $11,500, payable to Andrew McKinley, one year after its date, who subsequently assigned it to C. T. Bowen.
The notes of Swope to Gordon, by assignment, be
This suit was instituted to enjoin and restrain said bank from proceeding with the sale of the block of land in controversy, alleging that the notes had all been paid. Swope obtained a decree in his favor in the circuit court, which, on appeal to the co.urt of appeals, was affirmed, and defendants have prosecuted their appeal to this court.
The only question for consideration is, was the transaction between Honoré and Doane and the bank, a payment of the Swope notes? That it was the intention of Doane and Honoré that the former should purchase, and not pay off the notes, the evidence leaves no doubt. If Doane intended to pay off the notes, why his precaution to ascertain whether they were or not a first lien on the property ? and why so solicitous for the opinion of Mr. Albert Todd in regard to the title to the block? All the circumstances show that it was his purpose, as agent, to make an investment for the Atlas Bank, and his positive testimony is, that he purchased the notes. That this was also what was contemplated by Honoré, is shown by his letters to the St. Louis Life Insurance Company, and his conversations
It is contended that the draft for the aggregate amount of the notes was drawn on Honoré, who was bound for their payment, and, therefore, the payment of the draft was a payment of the notes. The cashier of the Atlas Bank testifies that the draft was not paid, but that an amount corresponding to the amount of the draft was paid, which was the sum total of the notes. He is not contradicted, although the transaction upon its face bears a different construction. This, however, is well explained by the witness, briefly, in answer to the following interrogatory : “ Don’t you think that the cashier of the St. Louis Bank, or any other third party, on reading your letter, would interpret the words ‘ accept for larger amount,’to mean that you had paid the Honoré draft ? ” Answer.
But suppose it is treated as a payment of the Honoré draft, does that, in view of all the facts, constitute payment of the notes? It is contended that Doane and the Atlas Ba nk had knowledge that, as betwixt him and Swope, the Swope notes were Honoré’s debt, and he was primarily liable to pay it, and that, therefore, the payment of the Honoré draft was a payment of the notes. Conceding, for the argument, that from these facts, that would be a legal conclusion, the facts are not established by the evidence. Doane testifies, that all he knew of that matter was, that Honoré’s conveyance was taken subject to the encumbrance of the Swope notes. No witness testifies to the contrary. The conveyance, it is true, was subject to the encumbrance, and this was expressed in the deed, but that did not create a personal obligation on Honoré to pay those notes. This is well settled in this State, and we know of no text book or adjudged ease, that holds otherwise. Heim, v. Vogel, 69 Mo. 529; Hoy v. Bramhall, 19 N. J. Eq. 75.
The court of appeals, in its opinion, fell into an error in stating that the knowledge of his (Honoré’s) position, with reference to these notes, was brought home to the bank, when with the deed of trust, containing the assumption of payment by Honoré of the Swope notes and the Honoré draft before him, the cashier sat down to fill up the blank in the Bowen-Honoré note with the description of the collaterals. The only deed then before the cashier was the deed of trust from Swope to Leffingwell, to secure the notes in question, and it contained no reference whatever to Ilonoré’s obligation to pay them, because, at its date, there had been no transaction between Swope and Honoré. The deed from Swope to Honoré was not before him, nor had he or Doane, or any officer of the bank, ever seen it, and if they had, it contained, as we have seen, no stipulation binding Honoré, personally, to pay the SwopeGordon notes, so that the only information Doane, or the
Conceding then that the Honoré draft was paid, as is contended, does that, under the circumstances, amount to payment of the notes ? It was the plan adopted by the insurance company and Honoré to effect a sale of the notes; Honoré did not raise the money to pay it. His name was not on the first Bowen note. This is the positive testimony of the cashier of the bank, and the facts, that the proceeds of the discount of that note were placed to the credit of Doane on the books of the bank, and the name of Honoré nowhere occurred on the books are strongly corroborative of his statement. It was a clumsy mode of accomplishing a very simple result; but the form is not to overshadow the substance. It was not a payment of the notes by Honoré, or any one for him, nor did either the holder of the notes, or Honoré, or Doane, or the bank, or any one connected with the transaction intend any such thing, or suppose that it had been done. Honoré’s name in the draft is of no more significance, in the light thrown upon the transaction by all the antecedent circumstances, than if it had been drawn on John Doe or Richard Roe.
Considerable stress is laid upon letters written by Honoré to Britton, in one of which, July 21st 1874, he states that he “had made arrangements with a party to pay the Swope notes;” in another, July 29th, 1874, that he was surprised and annoyed by receipt of a telegram “ saying these Swope notes had not been paid;” but in the letter of the 2l8t day of July he also says: “I had made arrangements with a party who left here for New York Sunday to pay the Swope notes, but have just received a telegram from him that the papers had all been returned to St. Louis. I have just telegraphed you as follows: ‘Papers not in New York. Party who is to pay them gone to Boston, and wants them sent to Atlas National Bank, Boston. Please do so. Answer.’” Can there be any doubt that the reference in this letter is to Doane and the arrangement between
It is alleged in the petition that Bowen was jointly concerned with Honoré in the purchase of the block, and as between them, was equally bound to pay the Swope notes, and for this reason, it is contended, he executed his note for discount at the Atlas Bank. There is not a particle of testimony to that effect; but on the contrary, Bowen testifies positively, that he had no interest whatever in that purchase, and that he executed that note in order to prevent a sale of the premises under the Swope deed of trust, to the sacrifice of his lien for the note assigned to him by McKinley. We think the conclusion, from all the facts of this case, irresistible, that it was not in the contemplation of Honoré, or Doane, or Bowen, or the bank, or the insurance company, the holder, that the notes were paid, or to be paid, by the transaction betwixt them.
The authorities are all to the effect that “if money be
The case of White v. Knapp, 8 Paige Ch. 175, we regard as directly in point. Hinkley had executed a mortgage to a bank on property, which he afterward conveyed to Knapp, to whom he obliged himself to pay the incumbrance. Knapp subsequently executed a mortgage to White of the same property for $1,413.27. In June, 1836, the bank demanded of Hinkley the balance due on his mortgage, and not having the money, he induced the son of the defendant, Thomas, to let him have $380 of his father’s money to pay off said mortgage, promising that Thomas’ father should have the same security for the money that the bank then had, which arrangement the father, when informed of it, sanctioned. Hinkley, the debtor, then went to the bank with the money thus obtained, together with a further sum of his own, and took from the bank an assignment of the bond and mortgage to Thomas, to whom
Two respectable courts having decided this cause against the defendants, we have given it the consideration, which that fact, and the amount and principle involved, demanded, and been forced by the evidence, to the conclusion that the Atlas Bank has, both in law and equity, a right to the lien it claims upon the property in question, and that the judgment should be reversed and the bill dismissed, and, all concurring, it is so adjudged and ordered.
Rehearing
On Motion for Rehearing.
In the view we take of this case, it does not matter whether Honoré, by stipulation in the deed from Swope to him, assumed the payment of the notes in question or not. The authorities cited in the opinion fully sustain the position, that if the parties to the transaction intended a purchase, and not a payment, of the notes, it did not amount to a payment, although Honoré was personally liable to pay them, and the other parties were aware of that fact. That purchase, and not payment, was in the contemplation of all the parties, we still think clearly established by the evidence. Whether the trust property is worth more or less than this court found from the evidence, is of no consequence, because the right of the Atlas Bank to resort to the deed of trust, executed by Swope, for satisfaction of the notes, is the same whether the property is worth $100,000 or only $10,000. Counsel allege that three contradictory statements, as deductions from the
With regard to the right of the Atlas Bank, under the National Banking Act, to buy this paper, it is only necessary to say that the judgment of this court, in the case of Matthews v. Skinker, 62 Mo. 329, holding that a national bank could not deal in such securities, or avail itself of the deed of trust executed to secure' them, was reversed by the Supreme Court of the United States, and we may add, that Matthews v. Skinker was overruled by this court before the judgment was reversed by the Supreme Court of the United States. Thornton v. The National Exchange Bank, 71 Mo. 221.
Nothing has been alleged which raises a doubt in our minds, that the opinion heretofore delivered is in accord with well established principles of equity, or that our conclusions were not warranted by the evidence. The motion is overruled.