Orr v. Rode

• Decision Date: 16 June 1890
• Parties: Orr v. Rode et al., Plaintiffs in Error
• Court: Missouri Supreme Court

13 S.W. 1066

101 Mo. 387

Orr v. Rode et al., Plaintiffs in Error

Supreme Court of Missouri

June 16, 1890

Error to Buchanan Circuit Court. -- Hon. J. P. Grubb, Judge.

This action was commenced by the plaintiff October 30, 1880 against the children of John H. Rode, deceased, who are the sole devisees (and the husbands of such of them as were married women), and James W. Strong, Ira Brown and others, to foreclose a deed of trust in the nature of a mortgage executed by defendant Strong, dated April 3, 1867, purporting to convey certain land described in Buchanan county Missouri, to defendant Brown, in trust to secure the payment of a promissory note of the same date, whereby defendant Strong promised to pay to the plaintiff, one year after that date, four thousand dollars, with interest at ten per centum per annum.

On the back of this note are the following indorsements: "Paid on this note two hundred and ten dollars interest November 16, 1874; October 23, 1875, credit by Weatherby notes, three hundred and fifty-one dollars, credit by Chesmore, ten dollars."

The pleadings in the case need not be fully given. The answers of certain of the defendants, besides general denials, set up the statute of limitations. The deed of trust sought to be foreclosed in this proceeding was executed by defendant Strong pursuant to supposed authority conferred by an earlier conveyance of John H. Rode, upon the construction of which the case chiefly turns.

The language of the deed, last mentioned, bearing directly on the pending controversy, is as follows: "To have and to hold the same, together with the appurtenances thereunto belonging, to the said party of the second part (Strong), and his successors and assigns forever. This conveyance is made in trust, however, for the following uses and purposes, that is to say: That, whereas the said John H. Rode is now indebted to divers persons; and whereas several judgments are now of record in said county of Buchanan, and which are liens upon the real estate and property hereby conveyed, and this conveyance is made to enable the said party of the second part to sell such parts of said property as may be desired to settle and satisfy said debts, and the said party of the second part is hereby empowered by the parties of the first part to make any arrangements which he may deem advisable with any of the creditors of the said John H. Rode, and in order to settle said debts he may give his individual notes for the same, and execute a mortgage on the before-described lands or lots, or any part thereof, to secure the same, upon such terms, and payable at such times as to him may seem proper and advisable; and he is also authorized to sell and convey any part of said property or real estate for such fair price as he may deem advisable for deferred payments of any of said indebtedness, selling the unimproved town lots first that is, the lots having no dwelling house on, first, and the whole of the town lots before selling the said tracts of land or any part thereof, and continuing to sell such parts as may be proper and necessary, until all of the said debts, which are liens on said real estate, are paid, and then such other debts as may now exist against said Rode, paying his security debts last. And, it is further understood, directed and agreed that after said debts are paid, that said lands are not to be disposed of or sold by said party of the second part unless it is to reconvey the balance thereof to the parties of the first part, or to convey the same by their written request or concurrence in writing."

The cause was tried by the court. Several of its rulings are the subjects of exceptions that will be noted, with other material matters, in the progress of the opinion of the court.

The plaintiff was examined on his own behalf as a witness and his testimony (referred to in the opinion) was as follows William Orr, the plaintiff, called in his own behalf, being duly sworn, testified as follows:

DIRECT EXAMINATION.

Questions by Mr. White: "Q. You are the plaintiff in this case? A. Yes, sir."

Mr. Brown: "We object to Mr. Orr's being permitted to testify here in the case at all. He is the opposite party, and the pleadings show that Mr. Rode is dead. We think he is an incompetent witness."

The court: "The objection is overruled."

To which ruling defendants then and there excepted.

"Q. Where do you live? A. I live in Maysville, Missouri.

"Q. How long have you lived there? A. I come there in 1854.

"Q. Been living there ever since? A. Yes, sir; close to there. I don't live in town all the time, but I live there and around there.

"Q. Lived there in 1867? A. Yes, sir.

"Q. Were you acquainted with J. W. Strong? A. Yes, sir.

"Q. State, Mr. Orr, the circumstances which led to your making this loan in question, fully. A. Well, sir, Mr. Strong came down there to court and asked me if I had any money to lend. 'Well,' says I, 'I don't know how.' He found out I had some money here in Mr. Beattie's bank, and he called my attention to it, and told me that it might as well be drawing me interest as to be laying there. I told him I did not know whether I cared about lending it, or not. He insisted on me lending it, and I finally came to the conclusion that I would lend it, providing he gave me security, and he told me that he wanted it for Mr. Rode."

Mr. Brown: "We object to him being permitted to testify to the remarks that he made to Strong, and we wish to save an exception to the ruling of the court on that specific objection."

The court: "I can't see where this testimony will lead to. I don't see its relevancy as yet."

Mr. Brown: "We think that he is incompetent to testify."

The court: "So far as anything that took place between him and Mr. Rode, as a friend, he is unquestionably incompetent, and I am unable to see any relevancy, but so far as any conversation between himself and Mr. Strong, his friend, I don't see what harm it can do. I will hear it out anyway, and I will take it from me by instructions, if necessary."

"Q. Did not Mr. Vories ask him if he would not let Mr. Strong have the money?"

Mr. Brown: "We object to his stating what Henry Vories may have said, on the ground of irrelevancy, Mr. Vories being dead."

The court: "Well, that objection is sustained."

Mr. White: "We except."

Mr. White: "We offer to prove that William Orr, prior to making this loan, consulted with Henry M. Vories, the agent and adviser of John H. Rode, as testified to by Allen H. Vories; that in that conversation Henry M. Vories told William Orr, that the sum of four thousand dollars was needed by John H. Rode to pay off his debts; that in the same conversation H. M. Vories told Wm. Orr that Strong had the power and right to borrow this for John H. Rode, and under the deed of trust in evidence; and, in consequence of this statement, and not until then, did Mr. Orr loan the money."

The court: "You will not be permitted to show this by this witness."

"Q. State if you loaned the money on the note and deed of trust, as read in evidence, to Mr. Strong. A. Yes, sir; I gave my check on the bank for four thousand dollars, and he got the money -- at least he told me he did. I seen that they charged it to me in my account."

Mr. Brown: "We object to that, as incompetent, for the witness to testify upon that matter."

The court: "The court has already said that your exceptions would be saved. You have said that more than once, and I have already stated that I would hear anything that took place between Mr. Strong and Mr. Orr."

The defendant then and there excepted.

"Q. What payments have been made you on this note? A. Those on the back of the note.

"Q. I will call your attention to these credits on that note. Were these payments made at the time they purport to have been made on the note?"

Mr. Brown: "We object."

The court: "I think the objection will be sustained as to that, Mr. White, Mr. Orr not being a competent witness to prove the credits."

Mr. White: "We except. Take the witness."

Mr. Brown: "Stand aside."

After a finding for plaintiff and the usual formal motions, this writ of error was sued out on the part of defendants.

Affirmed.

Ramey & Brown for plaintiffs in error.

(1) The power to sell the lands of Rode contained in the deed to Strong did not authorize Strong to raise money on them by mortgage. Price v. Courtney, 87 Mo. 387; Price v. Estell, 87 Mo. 378; Bloomer v. Waldron, 3 Hill, 361; Ferry v. Laible, 31 N.J.Eq. 567; Hoyt v. Jaques, 129 Mass. 286; 1 Jones on Mortgages [3 Ed.] sec. 129. (2) Even if the power to sell ordinarily included the power to raise money for the same purpose by mortgage, it would, in this case, be excluded by the fact that, in addition to the power of sale, a very limited power to mortgage is given in the deed. (3) The power to mortgage in this case to secure creditors until a sale can be effected, excludes the power to borrow money upon mortgage. "All trusts of terms directing the methods of raising money imply a negative, viz., that the money should be raised by the methods prescribed, and not otherwise." Price v. Courtney, 87 Mo. 387-393. (4) A power of sale can be exercised only in the mode, and upon the exact conditions terms and occasions prescribed in the instruments of trust. Kinney v. Mathews, 69 Mo. 520; 2 Perry on Trusts [3 Ed.] sec. 783, and cases cited; Vail v. Jacobs, 62 Mo. 130; Graham v. King, 50 Mo. 22. And this must necessarily be as true of a power to mortgage. Kinney v. Mathews, supra. (5) As to the application to this case of the general principle that the purchaser from a trustee having power to sell to raise a particular charge must see to the application of the purchase money, we will cite: 2 Perry on Trusts [3 Ed.] secs....