25 F. 689 | U.S. Circuit Court for the Southern District of Georgia | 1885
Jewell was a cotton-mill owner and planter, residing in this district; Woodward, Baldwin & Co. are commission merchants residing in the state of New York. Jewell would ship the products of his mill to Woodward, Baldwin & Co., they would sell the same on commission, rendering to him monthly an account of the proceeds. They would make advances to him to enable him to carry on his business, and these mutual dealings had continued from about the year 1870 to April, 1884. On the seventeenth of January, 1878, by instruments in writing then executed Jewell admitted an indebtedness to
The respondents set up two defenses: The first is usury in the transactions between Jewell and the complainants; and the second is that Jewell had the right to sell the lands, and they bought them in good faith.
With regard to the first defense, for several reasons the court is of the opinion that it is not maintainable. The mutual transactions covered a period of about 12 jrears; stated accounts were rendered Jewell monthly, and he acknowledged their correctness without objection. He is concluded as to these monthly accounts, and is barred by the statute of limitations from the plea of usury, and besides it is not at all clear that there was usury. It is true, interest was charged by Woodward, Baldwin & Co. on the balances which Jewell admitted to be correct; but these balances properly bore interest, and it is nowhere made to appear that more than 7 per cent, was charged. This cannot be held usurious, (Pinckard v. Ponder, 6 Ga. 253,) nor could their commissions be regarded as usurious.
This brings us to the consideration of the second ground of defense, namely, “that Jewell had the right to sell, and the respondents took an unincumbered title. ” It cannot be doubted that the two instruments executed by Jewell and Woodward, Baldwin & Co., on the seventeenth January, 1878, in legal contemplation, constitute one and the same contract. Slaughter v. Culpepper, 44 Ga. 325; 2 Bl. Comm. 327; Co. Litt. 236. Where two instruments are executed at the same time, between the same parties, relative to the same subject-matter,
It is urged for the complainants that Myrick and Mrs. Daniel hold under quitclaim deeds from Jewell, and for that reason cannot rely on the equities of bona fide purchasers without notice. This question has been adjudicated by the courts of the several states so as to leave a distressing conflict of authority; but the supreme court of the United States has settled the rule for our guidance here. They hold that a grantee in a quitclaim deed cannot defend as a bona fide purchaser without notice. Villa v. Rodriguez, 12 Wall. 323; Dickerson v. Colgrove, 100 U. S. 578. It may well bo doubted, however, whether these are quitclaim deeds. They convey the title absolutely, without the usual phraseology, “remise,” “release,” “relinquish,” “quitclaim,” etc. Besides, no form in Georgia is necessary to a conveyance, provided the intent to convey is clear. Ball v. Wallace, 32 Ga. 172.
Conceding, however, that the deeds are of the character claimed by the complainants, the notice with which the purchaser was charged is defect of title. But there was no such defect here, as Jewell had the right to sell and to make titles. This right was exercised. But it is insisted that the quitclaim deeds should have the effect to put on the purchasers the duty to see that the purchase money found its way into the hands of those to whom it belonged. 2 Perry, Trusts, 796, and 2 Story, 1127-1132, inclusive, are cited.
The English rule on this intricate topic is as follows: “Where the trust is to pay from the proceeds of sale a particular debt, the purchaser must see that the money finds its way into the hands of those to whom it belongs.” Perry, Trusts, 796. But this rule is not favored in American courts, and the same author, paragraph 798, concedes this; and Mr. Justice Stoky declares, after a full statement of the nice distinctions involved:
“They lead strongly to the conclusion to which, not only eminent jurists, but eminent judges, have arrived, that it would have been far better to hare held in all cases that the party having the right to sell had also the right to*692 receive the purchase money, without any further responsibility on the part of the purchasers as to its application.” Story, Eq. Jur. 1135. See, also, Elliott v. Merryman, Lead. Cas. Eq. (Amer. Uotes,) p. 73.
From these authorities the conclusion is obvious that, in the absence of allegation or evidence of collusion or fraud between the respondent Jewell and his co-respondents, the purchasers of the lands, the latter were under no legal obligation to look to the proper application of the purchase money.
The prayers of the bill are, for the reasons given, denied, with costs.