Western Manufacturing Co. v. Woodson

130 Mo. 119 | Mo. | 1895

Babclay, J.

The suit is in equity, and grows out of the facts which appear in the statement opening the report of the case. The decisive question is upon the proper construction of a deed by Jewett & Company to Mr. Woodson as trustee to secure notes of the former to the Saxton National Bank. These parties were respectively the first, second, and third parties to the deed.

The plaintiffs insist that the deed amounts to, and should be construed as, a general voluntary assignment of the property for the benefit of all creditors of the grantor, and not merely as a security for the Saxton National Bank. This claim is based upon section 424 (R. S. 1889), and the interpretation that the section has received in former rulings of the supreme court. Shapleigh v. Baird (1858), 26 Mo. 322; Crow v. Beardsley (1878), 68 Mo. 435.

The true meaning of the instrument seems to us different from that contended for by plaintiffs.

The defeasance is not as plainly expressed as it might be; but we think its substance and purport clear.

"Where the intent of a document is obvious, its failure to conform to some recognized formula of words to express the thought is not fatal, where no law requires such conformity.

Here it is evident that the property was conveyed in trust as security for debts due the Saxton Bank, and it was expressly provided that the balance of proceeds remaining after discharging the debts and interest should be paid.to the grantors.

The conveyance was declared to be “in trust” for the purposes described in the deed, of which the securing payment of the notes was evidently the chief one. Had the trust been executed, equity would compel a reconveyance.

Taking the document as a whole, we think it falls within the ruling in Hargadine v. Henderson (1889), 97 Mo. 375 (11 S. W. Rep. 218), namely:

“If from the nature of the instrument, either standing alone or read in the light of the surrounding circumstances, it appears to have been given as a security, it must be considered as a mortgage, and the law will apply thereto the rules applicable to mortgages” (p. 386).

2. Entertaining the view above given of the first deed (of February 8, 1893), it is unnecessary to consider whether the attempt to reform it by another instrument, two days later, was valid in contemplation of law or equity.

From what has already been said, it follows that the general result reached by the learned circuit judge, holding the deed to be a security and not a voluntary assignment, was right, and should be affirmed. It is so ordered.

Brace, C. J., and Macearlane and Robinson, JJ., concur.