| Mo. | Mar 29, 1912
Equity. On March 18, 1908, plaintiff sued in the Buchanan Circuit Court to set aside a deed of trust and trustee’s deed purporting to convey to defendant Hettie Lindsay lot one in block 3, South St. Joseph Town Company’s Second Addition to the city of St. Joseph, and for an accounting. The prayer of the bill was further that defendants he compelled to convey in default of such conveyance, title to he vested out of them and into plaintiff,
Questions raised seek a summary of the pleadings and facts, to-wit:
In brief the bill alleges that in August, 1904, E. M. Lindsay contracted in writing with named purchasers Waller and Arthur in consideration of $1945 (to be paid in a cash payment of $150, and thereafter in monthly installments of twenty-five dollars, with interest at six per cent from date of contract on each installment), to sell said purchasers said lot and convey same by warranty deed in fee simple when the purchase price was fully paid. The purchasers were to have possession and pay State and county taxes for 1904, and a special taxbill for grading and paving Cherokee street. (The terms of this contract will appear more fully hereafter.)
The bill then pleads a further provision in said contract giving Lindsay the option and right, at any time before said warranty deed was executed, to put a deed of trust on the lot for the amount unpaid on said contract at that date, with usual commissions and expenses — this to be by way of a loan from any person willing''to loan such amount on the premises. In that event Lindsay was to receive the proceeds of such loan, and thereupon execute to said purchasers a warranty deed with a provision therein that grantees assume the payment of such loan.
There follow allegations to the effect that the contract permitted its own assignment and that by several intermediate assignments it came finally to plaintiff who now holds all rights thereunder; that the cash payment was made, together with all monthly installments with interest, in accordance with the contract terms; that after plaintiff became the owner of
Referring to the Cherokee special tax, the bill alleges that it was outstanding, but the special tax-bill was void and created no lien against the lot; that on its face it called for $268.16; that on May 11, 1906, the interest accrued on said pretended taxbill was $131.91; that, without the consent of plaintiff, E'. M. Lindsay on said last mentioned date paid to the holder of said void taxbill, by way of compromise and settlement, sixty per cent thereof; that although the bill was void and the compromise unauthorized, yet on the 19th of March, 1907, plaintiff was ready and willing to pay, not only the amount remaining due on the purchase contract, but the amount paid by way of compromise on the void taxbill, together with interest.
Plaintiff then goes on to set forth in his bill the particulars of an alleged plan concocted between defendants to defeat and defraud him out of his interest in the lot. In a nutshell, as there told, that plan was for E. M. Lindsay to execute to his codefendant a pretended deed of trust to secure a pretended indebtedness of $1623, which said E. M. Lindsay pretended remained unpaid on the contract, instead of $1207, the true amount, of all of which defendant Iiettie had knowledge; that to further such covinous contrivance, on the 19th of March, 1907, E. M. Lindsay executed such deed of trust to a trustee securing on said lot a pretended note for such pretended amount due in three years, with semi-annual interest coupons at seven per cent; that said deed of trust provided for a default on the nonpayment of any coupon; that when the first coupon became dne E. M. Lindsay, in order to create a default, failed to pay it and at once brought
The bill then makes an offer to pay into court such sum as may be found due, and prays relief as hereinbefore stated.
The joint answer of defendants admits that E. M. Lindsay made the contract of sale with Waller and Arthur as pleaded in the bill and then goes on to set forth its terms more fully.
Among such additional provisions of the contract pleaded in the answer was one to the effect that though the purchasers were to have possession, ad interim, it was as tenants of E. M. Lindsay at a monthly rental equalling the monthly payment installments, plus accrued interest, and if they failed to make such monthly payments then E. M. Lindsay was entitled to take possession.
Another was that' the purchasers should take out insurance and on failure to .do so Lindsay might insure and the purchasers were to. reimburse him.
Another was that if E. M. Lindsay paid any taxes, “liens” or insurance the purchasers were to reimburse him, with eight per cent interest on such items — all guch outlays by Lindsay with interest were to merge in and be distributed among the monthly installments and were to be repaid prior to his making a deed to the purchasers. -
Another was that it was optional with Lindsay whether he paid any taxes, insurance or liens.
The answer then goes on to aver that the Barber Asphalt Paving Company held a certain taxbill against the property for paving Cherokee street; that said taxbill bore date October 2, 1901, and on its face called for $268.16, with interest at ten per cent per annum; that said bill was the one referred to in the contract of purchase; and that it was sued on by its owner on the first day of October, 1903, in the Buchanan Circuit Court.
Prom this point on, for several pages, the averments of the answer are directed to pleading facts showing good faith and exercise of contract rights by defendants. It is alleged that on March 19,1907, there was due under the contract purchase $1623 to defendant E. M. Lindsay; that pursuant to the contract power he on that day executed to one A. L. T., as trustee, a deed of trust securing to his co defendant said sum on said lot; that said sum was evidenced by a note due in three years with interest payable semi-annually at seven per cent; that the. deed of trust provided for default and foreclosure on the non-payment of any interest installment; that afterwards E. M. Lindsay (still pursuant to the contract power) executed a warranty deed to plaintiff with a provision therein that plaintiff assumed and agreed to pay said mortgage indebtedness ;• that said warranty deed was received by plaintiff on the - day of April, 1907; that in September of that year the first semi-annual installment of interest came due; that thereupon said trustee proceeded to execute the power of sale donated, and on November llth of that year made a sale at which the property was struck off to Hettie Lindsay for $1700; that thereupon he executed to her a trus
Finally it is alleged that plaintiff had full knowledge of said ejectment suit and of the execution of the deed of trust, the warranty deed and trustee’s deed; that after the execution of said deeds plaintiff stopped making monthly payments under the centract and failed to pay interest on the note or do anything else towards paying for the property; that plaintiff has no right, title or interest therein and wilfully failed to keep and perform the purchase contract; but through his agents, after his tenant was ousted in ejectment, attempted, vi et armis, to obtain possession by breaking doors and locks.
The reply was a general denial. .
At the trial the contract of purchase was read into the record and so far as material is in substance as set forth in the pleadings. So, certain ordinances and a contract relating to the improvement of Cherokee street were introduced. Their terms are immaterial.
{Note-. A proper construction to put upon plaintiff’s bill is that the special tax was compromised by Lindsay and that plaintiff in asking equity wanted to do equity and therefore was willing to pay the compromise sum with interest. In this view of the matter
A special taxbill was issued against the lot, under the ordinances and paving contract, on October 2, 1901, for the amount mentioned in the pleadings and drawing interest at ten per cent from date. It, in terms, was chargeable against the lot and Ernest Lindsay as owner. We infer that Ernest Lindsay is deceased, was the husband of defendant Hettie and the father of defendant E. M. We gather, from indirect testimony, that the lot belonged to an estate and that the title came to E. M. Lindsay through some domestic arrangement or by descent cast. At any rate he assumed the right to make a sale of it to Waller and Arthur and that right stands unquestioned. When he made that sale in August, 1904, the taxbill had then been outstanding and unpaid for about three years, and at said sale date said taxbill had been in suit for over a year. It seems all the property owners on the street united in contesting the validity of the taxbills issued for paving Cherokee street and employed the same attorneys to make a defense. As we make out those attorneys were to have a contingent fee of one-third of the amount saved off of the face of each bill. It seems, too, that E. M. Lindsay had charge of the defense against the taxbill in question, that he had been sued thereon and had been conducting that defense, as said, for over a year at the very time he made the contract with Waller and Arthur. It does not appear that Waller and Arthur or their assignees had anything to do with the defense or had been called upon to assist therein or pay the bill while the suit was pending. At a certain time in 1906 (probably in May) Lindsay on his own motion took part in a general compromise agreement whereby the lots on Cherokee
(Note: As there is a contention by defendants that the deed of trust and warranty deed were executed in accordance with the contract and in good faith, and one by plaintiff to the contrary, the facts on this score are material to a just determination of the case.)
Attending to the facts with more particularity, it seems Mr. Lindsay was the general agent for his mother, and seems to have had a sort of carte blanche -in all her business. Doing the best we can with the testimony, after an extended and analytical study of it, we cannot find she actually made any loan of money to her son on the lot, or accepted any loan, or paid out anything on account of such loan, or made or lost anything by the transaction, or took any personal or con
In the above version, we have given our impressions of the testimony, avoiding detail and not unmindful of the fact that Mr. Lindsay seems to have drawn and signed a check against his mother’s money kept by him in his name as agent in the Bartlett Trust Company, on March 16, 1907, for $5000. This check was drawn in connection with his purchase of corporate stocks in Kansas City on private account. The record seems to show, that in Mr. Lindsay’s dealings as agent the line between mine and thine was not closely observed, all this, however, by his mother’s acquiescence. There is a suggestion (or belief) indulged by Mr. Lindsay when on the stand that the check covered the proceeds of the loan in question in a bundle with other matters, but a close scrutiny does not satisfactorily sustain that suggestion, when taken with other testimony by him and his mother. One of his theories as a witness seems to be that he put up the loan with his mother as security for that check, but the testimony does not satisfy us on that score.
There are some facts relating to the letters written by Mr. Lindsay to plaintiff in March, 1907, bearing, it is claimed, on the equities of the case. G-oing back a little to that time, on March 16, 1907, he wrote and mailed the following letter to plaintiff:
Dear Sir:
I want to bring the matter of tbe Cherokee Avenue paving bills in front of Lots 1 and 2, Block 3, Second Addition, to a settlement, as I do not care to bave it in its present unsettled state any longer. I note that you state in your letter of Dec. 24, ’06, that you will settle these bills for 60 per cent of the face value of them. Is this your ultimatum in the matter and your final answer in regard to same ? I will appreciate it very much if you will give me an answer to this by return mail and also mail me the insurance policies on the two places to keep in my files with the contracts. It is usual to*69 do this just as you would do if there was a loan on the property, the man making the loan, holding the insurance policies.
Yours truly,
That letter was unanswered and plaintiff testified lie never saw it until after the foreclosure sale. He then found it opened in a bundle of other papers relating to the matter in Ms desk in Ms bank after Ms return from a prolonged absence. There is some testimony, however, indicating that he was in St. Joseph a day or so after March 16th.
On March 21, 1907, Mr. Lindsay sent the .mentioned warranty deed by registered mail to plaintiff, and a postof&ce receipt therefor, signed by plaintiff, is shown by the testimony. Inclosed in the envelope containing the deed was the following letter and statement :
“Mr. Porter A. Thompson,
So. St.*Joseph', Mo.
.Dear Sir:
About Dec. 5th, ’06, I wrote you concerning taxbills against lots 1 and 2, block 3, Second Addition property. These were taxbills issued for asphalting Cherokee street. On Dec. 24, ’06, you wrote me stating that you would not pay more than sixty per cent of the face value of these bills, in answer to which letter I wrote you on the 16th of March, 1907, asking you if this was your ultimatum in the matter and asking you to kindly write me by return mail, if possible, stating your wishes in the matter as the bills were long past due. As is customary and essential in such transactions, I also asked you to mail me the insurance policies on your two places so that I would be protected in my loan in case the buildings should burn. I have not as yet had the courtesy of a reply of any nature from you. I have therefore decided to place lot 1, block 3, in a loan and herewith send you warranty deed for this lot, which deed is second and subject to a deed of trust dated March 19, ’07, securing note amounting to $1623 running three years with interest at seven per cent per annum, payable semi-annually, the first installment of which interest comes due Sept. 19, ’07. I herewith inclose you a statement showing the items of which this $1623 is made up. Unless X hear from you soon in regard to the matter I will take it for granted that you have no insurance policies on this building so that I will have to take out insurance policy myself for $700 and file with this first mortgage as per the terms of same.
Yours respectfully,
E. M. Lindsay,
March 21, ’07.
$1045.00 Prin. due on Contract to Mar. 19, ’07.
162.00 Int. due on Contract to Mar. 19, ’07.
$1207.00
268.16 Taxbill Lot 1, Block 3.
131.91 10% Int. due on Taxbill to May 11, ’06.
14.30 6% Int. due on Taxbill from May 1, ’06, to Mch. 19, ’07.
1.75 Recording Deed of Trust.
$1623.12”
Speaking of the last letter, there was evidence tending to show that plaintiff on March 21st received information there was a registered letter at the post-office. The postal officials refused to deliver it as ordinary mail, hut sent plaintiff, through his messenger, a receipt to sign. This receipt he signed when traveling bag in hand he was about to leave for Colorado, on a waiting train. The signed receipt was taken to the postoffice by a clerk of plaintiff’s bank and the letter was handed to the clerk, who brought it and laid it on plaintiff’s desk, he having gone to his train. When he returned at a certain time after the foreclosure he saw the letter and statement for the first time then open with the letter of March 16th. Plaintiff had left instructions to forward his mail. This mail was not forwarded to him. He left behind no authority with any one to deal with any phase of the matter in his business with Lindsay except to pay the monthly' installments, as heretofore stated. Who opened these letters or why they (or their contents) were not forwarded to him is not disclosed. These letters were eventually found in a drawer or other receptacle of plaintiff’s desk, but who put them away there is not disclosed. Neither is it clear that plaintiff was absent from St. Joseph during the whole of the summer of 1907.
When the foreclosure sale was advertised, Lindsay cut out the advertisement from the newspaper and mailed it to plaintiff, but there is testimony that he addressed the envelope improperly and that plaintiff did not get it and knew" nothing of the foreclosure until after the event. c
Other evidence may be summed up in this way: there is some to the effect that plaintiff caused to be furnished a policy of insurance in obedience to the request of the March 21st letter, and testimony to the contrary.
There is evidence of an attempt over the telephone, by personal interview and by correspondence, to compromise the matter after the foreclosure and allow plaintiff to redeem — we deem it unimportant.
At no time until after the decree, did plaintiff tender the amount he claimed to be due Lindsay. He offered to pay, but made no tender as that term is defined in the law.
Defendants put in evidence showing that after Lindsay’s mother got her trustee’s deed he caused a suit to be brought in her name against plaintiff’s tenant in straight ejectment and that such suit, on default, ripened into a judgment followed by the execution of a writ of restitution. The proof sustained the answer on that score and plaintiff, at some uncertain time before the end of that suit, had notice of it.
Any other necessary facts anent proof, pleadings or decree will appear in the opinion.
The brief of defendants’ industrious counsel takes a wide range. We think it better to formulate questions here in our own way.
The argument in support of the assignment, as we grasp the run of it, is that plaintiff stated himself out of court when he pleaded the clause in the contract requiring the purchaser to pay the Cherokee street tax-bill. But that clause, as presently seen, was one of several relating to liens and taxes. A proper construction of a contract arises on the whole subject-matter —parties, their relations to each other, the object to be subserved by the contract, and the language all considered. Prom that view-point neither do the pleaded terms of the contract nor the allegations of the bill mean that plaintiff was to pay this whole taxbill, whether or no and at all events, as contended. The matter is further dealt with in the next paragraph. We disallow the point to defendants. '
(b) It is argued that (under the contract) Lindsay had the right to buy this taxbill, and when bought had the right (still under the contract) to collect its face with interest at ten per cent from date from the lot purchasers; and to that end (still under the contract) he had the further right and option to merge the amount of the taxbill, so computed, into the balance due on the contract, borrow enough on the lot to pay himself such aggregated sum ánd then make a warranty deed with a provision therein binding the prior lot purchaser, without any voice in the matter, to assume and pay the whole amount. But if Lindsay had the right to buy that taxbill such right did not
We may say, in passing, that when the contract of purchase is read from end to end and corner to corner and its cold letter is illuminated and made alive by existing facts and circumstances and the relations of the parties, it would be a harsh and unnatural construction of the contract that would permit Lindsay, while he was defending against an over-due taxbill as void, to sell the lot, thereafter carry on the defense of invalidity and then (presto! change!) without notice to the lot purchaser of his change in attitude, or the existence of any overpowering necessity, turn about, abandon the defense, and buy the bill he claimed was invalid at the time he sold the lot and fasten it at his own volition with its accumulated burdens upon the lot as a valid lien. That would be to make of the purchase contract a trap to catch the unwary purchaser by the heel. Justice to.Mr. Lindsay in this case requires us to save him from the imputation of making such a contract, for the contract does not -read that way.
In the above view Mr. Lindsay violated the contract when he assumed the right to compel the purchaser to repay, not only the amount of the outlay in the compromise, but several hundred dollars more, to-wit, the face of the bill and its accumulation of
(c) Under this record E. M. Lindsay was in legal effect, his mother — only one person acted in the so-called loan, deed of trust and foreclosure and he was that person. The eye of equity cannot see her without seeing him. It must look through him to see her at all. Hence notice to him was notice to her and his knowledge was hers. We cannot hold her an innocent party in the loan nor an innocent purchaser at the sale. The equitable yardstick, then, that measures his rights measures hers and she may not with full notice, as here, hold a gift fetched to her by his hand.
(d) So, under this record the purchase contract contemplated a real loan of real money really borrowed — not a loan in name only, a simulated and color-able contrivance. Here there was no loan at all. So, the deed of trust purporting to secure the imaginary loan was ill of the same infirmity afflicting the loan. In equity it was a mere idle aggregation of words, a shell to be broken into dust by the hammer of the chancellor. So, a sale under such trust deed to a purchaser with notice, as here, conveyed subject to the equitable right of the holder of the lot purchase contract to redeem, unless there is something else in the case defeating redemption.
(e) It is earnestly argued there is something else in the case defeating the right to redemption. It is argued that plaintiff cannot redeem because of estoppel, because of negligence, because the statement furnished by Lindsay to plaintiff on the 21st of March,
(1) As to estoppel it was not pleaded. It makes its virgin appearance in this court. It is trite general doctrine (with exceptions not material here) that a litigant who relies on estoppel must plead estoppel. Moreover, the virtue in the plea of estoppel lies, as a general rulé, in the proposition that, the facts constituting the estoppel were relied on by the party to' be affected, caused "him to change his situation or in some way to suffer detriment or loss by reason of such reliance. All these elements are wanting in the facts of this case. Lindsay without persuasion of plaintiff, with wide open eyes, for his own by-ends and purposes voluntarily took the wrong road and travel-led it to the end. Plaintiff said nothing to him and did no acts in pais that led him to take that road. The letters of March 16th and March 21st show beyond peradventure that he made up his own mind on his own knowledge for his own ends and acted accordingly. There had been a disagreement between him and plaintiff over the amount due on the taxbill. He cut the Gordian knot himself and took his own course at his own will. There would be no estoppel if the pleading warranted that defense.
(2) As to negligence. The rule is that no man is entitled to the aid of a court of equity when that aid becomes necessary by his own fault. That doctrine is invoked' by defendants. The full statement of the facts heretofore made must be our justification for omitting an extended reference to them or a prolonged discussion of them. We rule that plaintiff’s inattention to his business is not the cause of and gave no rise to the claimed right to the equitable relief here invoked. Mr. Lindsay,.without any negligence on plaintiff’s part at the outset, wrongfully fastened upon
(3) Defendants invoke the doctrine applicable to an agreed or stated account. No such issue was raised by the pleadings nor would the facts warrant such defense if it had been raised. Defendant Lindsay was not lulled into the belief by plaintiff’s silence that he agreed to the account. His letters show that plaintiff was not agreeing to it. So, Lindsay did not wait to see if plaintiff by silence would agree. His blow followed his word like an echo. We know of no rule of law preventing the surcharging and falsification even of a stated account. We prefer, however, to let our ruling rest on the fafct that no such issue was raised by the pleadings, hence is not here.
(f) While the answer pleaded a prior judgment in favor of Mrs. Lindsay in ejectment for possession against plaintiff’s tenant, yet such judgment is not res adjudicate, where there is no equitable defense pleaded. That part of the answer together with the facts sustaining it are put out of view.
(g) Complaint is made because the decree awarded rents and possession to plaintiff. The testimony on rental value went in without objection. With sonie hesitation we rule the point against defendants. We are constrained to this course because the doctrine
(h) Complaint is made that the chancellor did not award interest on the amount due on the contract from March 19, 1907, down to the rendition of the decree. We find that is so and for that reason and to that extent the judgment is reversed and remanded to correct that error. Plaintiff invokes and was entitled to invoke the contract of purchase. But he must stand by it and comply with it. He made no' tender that would stop the running of interest and he should pay interest according to the contract as the price of his decree.
For the reason -stated in the last paragraph of the opinion the judgment is reversed and the cause remanded with directions to the chancellor to compute the interest due from plaintiff as indicated and include it in the redemption price found due, and decree accordingly.