Huffman v. Nixon
| Decision Date | 14 November 1899 |
| Citation | 53 S.W. 1078,152 Mo. 303 |
| Parties | Huffman, Appellant, v. Nixon et al |
| Court | Missouri Supreme Court |
Appeal from Saline Circuit Court. -- Hon. Richard Field, Judge.
Reversed and remanded (with directions).
W. M Williams and John Cosgrove for appellant.
(1) According to the evidence Chas. T. Kelsey was to examine the deed of trust and the abstract before he made the loan therefore, the deed of trust did not take effect until after Chas. T. Kelsey examined and accepted it. Kuh v Garvin, 125 Mo. 562; Cravens v. Rossiter, 116 Mo. 338. (2) If Chas. T. Kelsey ever accepted said deed of trust, its acceptance only operated from the time of such acceptance as against plaintiff, who purchased under judgments rendered in the attachment suits against J. B. Kelsey. Cravens v. Rossiter, supra. (a) It was for the defendants to show the exact time when the deed of trust was accepted. They alone knew the fact, and having failed to show the date of acceptance, the presumption is that it was not delivered to Chas. T. Kelsey until after the attachment liens became perfected. Tyler v. Hall, 106 Mo. 319. (b) J. B. Kelsey could have directed the deed of trust to be returned to him at any time before it was actually delivered to and accepted by his brother, Chas. T. No rights could be acquired by Chas. T. Kelsey under the deed of trust until these formalities had been complied with. Hull v. Hull, 65 Mo. 689; Cook v. Brown, 34 N.H. 460; Van Stone v. Goodwin, 42 Mo.App. 48. (c) The delivery of the deed of trust by the grantor to the recorder does not change the rule of law above contended for. Cravens v. Rossiter, supra; Hall v. Hall, 107 Mo. 101. (3) "The deed of trust, while apparently valid, was, in fact, fraudulent," and conferred no rights upon Charles T. Kelsey or the holders of the note. Knoop v. Kelsey, 121 Mo. 647. (4) When plaintiff purchased at the sheriff's sale, he acquired all the interest of J. B. Kelsey in the land sold, and after said sale the sheriff's deed vested in plaintiff the entire interest in the land sold, subject to the right to set former conveyances aside for fraud. Lionberger v. Baker, 88 Mo. 452; Knoop v. Kelsey, 121 Mo. 648; Gentry v. Robinson, 55 Mo. 260. (5) The sheriff could not, by any statement, reduce the interest of J.B.Kelsey in the land. The sale by the sheriff conveyed all of J. B. Kelsey's right, title and interest in the land, and the sheriff could not limit the interest so sold by any act or statement of his. Dodge v. Walley, 22 Cal. 224; Whipple v. Farmer, 3 Mich. 436.. (a) There is no warranty of title at sale made by a sheriff, nor has the officer any authority whatever, in his official capacity, to make any warranty or representation concerning the title or interest conveyed. The plaintiff acquired all of defendant Kelsey's title, whatever it might have been. 2 Freeman Exec. (2 Ed.), sec. 335. (6) This court has twice held that the deed of trust under consideration was fraudulent. Knoop v. Kelsey, 102 Mo. 291 and 121 Mo. 647. If it were longer an open question, the evidence clearly shows that Chas. T. Kelsey, Nixon and J. B. Kelsey were all acting in concert to cover up J. B. Kelsey's property and to keep it out of the reach of his Missouri creditors. It is sufficient to make the deed of trust voidable, when attacked by plaintiff, who purchased the right to assail it for fraud, to show that either the trustee or beneficiary had notice of the fraudulent intent. Crow v. Beardsley, 68 Mo. 435. (a) The deed of trust being fraudulent, plaintiff can maintain this suit to set the same aside. Potter v. Adams, 125 Mo. 118; Gentry v. Robinson, 55 Mo. 260; Knoop v. Kelsey, 121 Mo. 642. (7) The deed of trust having been executed in fraud of the rights of J. B. Kelsey's creditors, nothing passed by it to either the trustee or the beneficiary. There was no equity of redemption in J. B. Kelsey, which can only exist in cases of a valid and bona fide mortgage or deed of trust. The existence of an equity of redemption presupposes the existence of a legal mortgage. Bullard v. Hinkley, 6 Greenl. (Me.), 289. (8) The contention of defendants' counsel in the trial court was that the sheriff sold only the equity of redemption of J. B. Kelsey in the land, and the trial court so held. The sheriff acted under the statute and, in virtue of the judgment of the court and the law under which he acted, conveyed all of the interest of J. B. Kelsey in said real estate. Stanton v. Boschert, 104 Mo. 393; R. S. 1889, sec. 543.
Silver & Brown and B. R. Richardson for respondents.
(1) The perfected attachment liens under which appellant claims title do not antedate the title under the deed of trust. (a) The first attachment abstract was filed at 2 o'clock in the afternoon of August 25th, 1882, and the evidence all tends to show that the deed of trust was received by Nixon at Oswego, N. Y., on August 23rd, and on that day delivered to Dr. Charles T. Kelsey and accepted by him. (b) That an attachment lien is not completed or perfected until the filing of the abstract of attachment in the recorder's office is firmly established in this State. Stanton v. Boschert, 104 Mo. 393; Bryant v. Duffy, 128 Mo. 18. (2) Plaintiff's ground for relief founded on the alleged priority of the attachment over the title under the deed of trust was set up for the first time in his amended petition filed more than ten years after the deed of trust was placed of record. He is, therefore, seeking relief on a new title or cause of action, and is barred in respect thereto by ten years' statute of limitations pleaded in the answer. Sims v. Field, 24 Mo.App. 557; Buell v. Ins. Co., 45 Mo. 562; Holmes v. Front, 7 Peters 171. (a) The statute of limitations runs against a conveyance made in fraud of the grantor's creditors from the time it is recorded. Liese v. Meyer, 143 Mo. 555; Rogers v. Brown, 61 Mo. 195; Hughes v. Tettrell, 75 Mo. 573; Funkhouser v. Lay, 78 Mo. 466. (b) Where the statute so begins to run, no intervening matter, such as infancy, possession or the like, can thereafter interrupt its course. Cunningham v. Snow, 82 Mo. 587. (3) A sale though made by a vendor with fraudulent intent, is not invalid, unless the vendee had actual notice and knowledge of such intent; the knowledge of facts which, if investigated and followed, would lead to knowledge of the fraud, is insufficient. State to use v. Mason, 112 Mo. 374. (a) The case before the court is one of conditional sale, i. e. the deed of trust in question is a conditional sale, J. B. Kelsey not having been a previous creditor of C. T. Kelsey. A fraudulent intent to render a sale of property void as to creditors must exist at the time of the sale, and the vendee must have knowledge thereof. Hill v. Taylor, 125 Mo. 331; Sexton v. Anderson, 88 Mo. 379. (b) Fraud is never presumed, but must be proved; while it may be inferred from facts and circumstances, the burden rests upon the party asserting it to make it manifest. Hardcastle v. Hamilton, 121 Mo. 465; Priest v. Wray, 87 Mo. 16; Funkhouser v. Lay, 78 Mo. 458; Hausman v. Hope, 20 Mo.App. 193. (4) Where an execution creditor sells the equity of redemption in land, such creditor is estopped to assail the mortgage or deed of trust on the land as being in fraud of creditors, and the purchaser at the execution sale occupies no better position than the execution creditor. Knoop v. Kelsey, 102 Mo. 291; s. c., 121 Mo. 642; Craig v. Zimmerman, 87 Mo. 479; Messmore v. Haggard, 46 Mich. 559; Freeland v. Freeland, 102 Mass. 478; Flanders v. Jones, 30 N.H. 154; Brown v. Snell, 46 Me. 490; Lord v. Sill, 23 Conn. 324. The sheriff's notice of sale, his deed which recites that he conveyed all the interest of J. B. Kelsey that "I might sell as sheriff as aforesaid by virtue of the aforesaid judgment, execution and notice," and all the facts and circumstances attending the sale and in evidence, conclusively show that appellant only bought the equity of redemption in the premises sold. 2 Freeman on Exec. (2 Ed.), sec. 339; Knoop v. Kelsey, 102 Mo. 298; s. c., 121 Mo. 642. (5) The findings of the trial court on the issues of fact were in favor of the defendants, and we submit that under the decisions of this court they should not be disturbed. It is uniform rule for this court to defer much to the finding of facts made by the chancellor. It held in a recent case that it would not disturb the findings of the lower court unless satisfied it was against the preponderance of the evidence. Bank v. Newkirk, 144 Mo. 473; Short v. Taylor, 137 Mo. 518; Rawlins v. Rawlins, 102 Mo. 563; Snell v. Harrison, 83 Mo. 651; Lallement v. Poupeny, 12 Mo.App. 580.
This is a suit in equity begun in the Morgan Circuit Court in April, 1892, to set aside a fraudulent deed of trust on certain land in Morgan county, executed by J. B. Kelsey to Charles D. Nixon in trust to secure the payment of a promissory note of $ 3,000 payable to Charles T. Kelsey, and praying that plaintiff's title be adjudged paramount to that conveyed by the deed of trust.
The cause was tried at the June term, 1896, of the Saline Circuit Court, where it had been taken on change of venue, and resulted in a dismissal of plaintiff's bill, to reverse which plaintiff has brought the case to this court by appeal.
The amended petition, upon which the case was tried, alleges, in substance, that plaintiff purchased the land embraced in the deed of trust in question at a sale under several executions issued upon judgments in favor of C. H. Knoop and another against J. B. Kelsey, made by the sheriff of Morgan county Missouri, during the October term, 1883, of the Morgan Circuit Court; that said judgments were rendered in attachment proceedings against the property of J. B. Kelsey begun August 23,...
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