Albert A. West Administrators v. Reed

• Decision Date: 30 September 1870
• Citation: 1870 WL 6410,55 Ill. 242
• Parties: ALBERT A. WEST et al. Administrators,v.HIRAM S. REED.
• Court: Illinois Supreme Court

55 Ill. 242

1870 WL 6410 (Ill.)

ALBERT A. WEST et al. Administrators,

v.HIRAM S. REED.

Supreme Court of Illinois.

September Term, 1870.

APPEAL from the Circuit Court of Kane county; the Hon. E. S. WILLIAMS, Judge, presiding.

The opinion states the case.

Messrs. MAYBORNE & BROWN, for the appellants.

Mr. CHARLES D. F. SMITH, for the appellee.

Mr. CHIEF JUSTICE LAWRENCE delivered the opinion of the Court: This litigation arose out of the following state of facts:

In April, 1850, Reed, the appellee, applied to West, a banker, for the loan of $500. West declined to lend the money, but referred Reed to one Johnson, who agreed to lend the money if Reed would give security on his farm, and if West would promise to pay the money at maturity, in case of Reed's default. This arrangement was made. Reed received the money, and executed to Johnson an absolute deed of the farm, containing 380 acres, and Johnson gave back a bond, binding himself to re-convey in case Reed should repay the money, in two installments, the first falling due September 15, 1850, the second, January 1, 1851. Reed was unable to meet the first payment, and in pursuance of the agreement, West paid the money, and took a conveyance of the land from Johnson. The bond from Johnson to Reed had not been recorded, and Reed promised to bring it and deliver it to the attorney of West, but neglected to do so, and when the attorney subsequently mentioned it to him, he said he had mislaid it. West continued to furnish Reed with money, from time to time, until May 7, 1859, at which date they had a settlement. Reed was a bachelor, with no family, and it was agreed between him and West that the indebtedness should be cancelled, and Reed should abandon his right of redemption, and take from West a lease of the farm for his own life, subject only to a rent little more than nominal. The precise amount of the indebtedness we can not ascertain from the record, but it was probably between $1800 and $2000, and undoubtedly much less than the value of the land, even subject to Reed's life estate. The annual rent to be paid was ten bushels of wheat, ten bushels of corn, one fat hog, twelve chickens, and the taxes. West also surrendered to Reed about five hundred dollars' worth of notes, which were independent of the money paid Johnson, and the bank account. The agreement, as stated by Reed himself in his testimony, was, that all papers should be cancelled and all indebtedness given up, the object being, he says, “to secure me the possession of the land during my life time.” At the same time with the execution of the lease, the parties executed the following instrument, written upon Reed's book of accounts, and designed to show the settlement and cancellation of the indebtedness:

“ May, 7, 1859.

We hereby certify that all matters herein mentioned and described, and all deal between us, are settled and cancelled; the consideration of which, in part, is a lease, executed this day, of the Reed farm, in section 36, township 40, range 36.

+----------------------+
                ¦[Signed]¦W. B. WEST,  ¦
                +--------+-------------¦
                ¦        ¦H. S. REED.” ¦
                +----------------------+
                

From this date until 1865, the relations of the parties continued amicable, Reed expressing to his neighbors his entire satisfaction with the arrangement he had made, saying he would rather West should have the farm, after he was gone, than any one else, and that he could get money from West whenever he needed it. In the spring of 1865, Reed demanded a settlement from West, and a re-conveyance of the land, and about the same time, West brought an action against Reed for rent. This suit was subsequently dismissed, and in 1866 West filed a bill in chancery against Reed and Johnson to procure a correction in the certificates of acknowledgment of the deeds. Reed then filed his cross bill, to redeem the land, and the cause having been heard upon bill, answer, replication and proof the court decreed that Reed should be permitted to redeem upon payment of $1999.51, the sum found to be due by the master. To reverse this decree, the administrators of West, who has died, have prosecuted an appeal.

We do not dissent from the general principles urged by the counsel for appellee. It is settled beyond controversy, that contracts between mortgagor and mortgagee, for the purchase or extinguishment of the equity of redemption, are regarded with jealousy by courts of equity, and will be set aside if the mortgagee has, in any way, availed himself of his position to obtain an advantage over the mortgagor. We do not, however, assent to the position, which we understand counsel for appellee to assume, that when the original transaction between the parties has not been in form a mortgage, but an absolute deed, with a bond to re-convey on the payment of the money at a specific time, the right of redemption can not be extinguished, except by an instrument which will operate as a technical conveyance of the mortgagor's estate in the land. He undoubtedly has an estate, which will pass by descent, or devise, or by deed. But it is nevertheless a purely equitable estate, that is to say, an interest in the land based upon equitable grounds, and which a court of chancery will protect and enforce when equitable considerations demand. But he...