Bailey v. St. Louis Union Trust Co.

• Decision Date: 24 May 1905
• Citation: 87 S.W. 1003,188 Mo. 483
• Parties: BAILEY et al., Appellants, v. ST. LOUIS UNION TRUST COMPANY
• Court: Missouri Supreme Court

87 S.W. 1003

188 Mo. 483

BAILEY et al., Appellants, v. ST. LOUIS UNION TRUST COMPANY

Supreme Court of Missouri, First Division

May 24, 1905

Appeal from St. Louis City Circuit Court. -- Hon. Selden P. Spencer Judge.

Affirmed.

H Chouteau Dyer for appellants.

(1) To determine whether a transaction is a conditional sale or a mortgage, the court will look not only to the deeds and writings, but to all the circumstances of the contract, to ascertain the real intention of the parties. Brant v Robertson, 16 Mo. 129; Tibeau v. Tibeau, 22 Mo. 77; Cobb v. Day, 106 Mo. 278; Kraemer v. Adelsberger, 122 N.Y. 467; Locke's Extr. v. Palmer, 26 Ala. 312; Wing v. Cooper, 37 Vt. 169; Voss v. Eller, 109 Ind. 260. (2) The fact that the defeasance relied on in this case was not executed until some days after the quitclaim deed was passed, is immaterial, as the agreement was entered into coincident with the giving of the deed, and such a defeasance need not be in writing. O'Neil v. Capelle, 62 Mo. 202; Bender v. Zimmerman, 122 Mo. 194; McClurkan v. Thompson, 69 Pa. 305. (3) "It may be laid down generally, and subject to very few exceptions, that wherever a conveyance or assignment of an estate is originally intended as a security for money, whether intention appears from the deed itself, or any other instrument, it is always considered in equity a mortgage, and redeemable, even though there is an express agreement of the parties that it shall not be redeemable, or that the right of redemption shall be confined to a particular time or to a particular description of persons." The quitclaim deed was given by plaintiff to secure an existing debt. Wilson v. Drumrite, 21 Mo. 325; Sharkey v. Sharkey, 74 Mo. 543. (4) The evidence clearly discloses that there was a subsisting debt at the time the quitclaim deed was executed, that the evidence of this debt, to-wit, the notes secured by the two deeds of trust, were not surrendered and cancelled when the quitclaim deed was given; that interest was charged on this debt subsequent to the giving of the deed; that the grantor was left in possession of part of the property conveyed, and that defendant professed to be aiding plaintiff to secure funds to take up the loan. These facts are clearly indicative of a mortgage. Book v. Beasly, 138 Mo. 461; Henry v. Davis, 7 Johns. Ch. 40; Bayler v. Bailey, 5 Gray (Mass.) 505; Reilly v. Cullen, 159 Mo. 322; 2 Story Eq. Jur. (13 Ed.), sec. 10; Ennor v. Thompson, 46 Ill. 214; Robinson v. Willoughby, 65 N.C. 520. (5) The fact that the indebtedness for which this quitclaim deed was given was secured by the deed of trust, can in no way militate against the subsequent transaction, and ipso facto convert it into an absolute sale. Chance v. Jennings, 159 Mo. 544; Book v. Beasley, 138 Mo. 455. (6) Defendant was bound in equity to expose plaintiffs' property for sale to the best advantage. Kelly v. Hunt, 61 Mo. 469; Chesley v. Chesley, 49 Mo. 540; Carter v. Obshine, 48 Mo. 300; Bank v. Stump, 73 Mo. 311.

Stewart, Eliot & Williams and J. M. Blayney, Jr., for respondent.

(1) The weight of the evidence tends to establish that the parties intended to do what they did do, viz., execute an absolute sale with power of purchase. Turner v. Kerr, 44 Mo. 432; Focke v. Buchanan, 59 S.W. 820; Mellish v. Robertson, 25 Vt. 603; Rue v. Dole, 107 Ill. 275; Todd v. Campbell, 32 Pa. St. 254; Jones on Mortgages, sec. 256; Douglas v. Moody, 80 Ala. 66. (2) Where the deed is absolute in form the burden is cast upon the grantor to prove that it was intended to be a mortgage. To overcome the presumption arising from the form of the deed, the evidence must be clear and unequivocal, "leaving no room for a reasonable doubt as to the facts relied upon." These facts must establish a "concurring" intention of the parties. The understanding of the grantor alone is insufficient. Bobb v. Wolff, 148 Mo. 344; Worley v. Dryden, 57 Mo. 226; 3 Pom. Eq., sec. 1196; Jones on Mortgages, secs. 260, 335; West v. Hendrix, 28 Ala. 234; Kent v. Lasley, 24 Wis. 654; Adams v. Pilcher, 92 Ala. 475; Douglas v. Moody, 80 Ala. 66.

BRACE P. J. Marshall, J., not sitting.

OPINION

BRACE, P. J.

This is an appeal by the plaintiffs, in a suit in equity, from a judgment of the St. Louis City Circuit Court dismissing the bill at their cost at the close of their evidence. The plaintiffs are David Bailey and his wife, Mary Hunt Bailey. The substantive facts disclosed by the plaintiffs' evidence are as follows:

Prior to the 11th of December, 1897, the said David Bailey was the owner of five lots in the city of St. Louis, encumbered by two deeds of trust theretofore duly executed and acknowledged by him and his wife, and duly recorded; one for $ 35,000, dated December 20, 1892, and the other for $ 2,744.36, dated January 2, 1897, to secure a note of that date. Of this second deed of trust the St. Louis Union Trust Company, the defendant, was the holder and owner. Default had been made in this second deed of trust held by the Trust Company and the property had been duly advertised and was about to be sold thereunder on the 11th day of December, 1897, when the foreclosure was arrested by the plaintiffs executing and delivering to the Trust Company a quitclaim deed to the premises for the expressed consideration of $ 2,900, the real consideration being the abandonment of the foreclosure sale and the following agreement in writing, to-wit:

"Whereas, David Bailey and Mary Hunt Bailey, his wife, have by quitclaim deed of this date, conveyed to the St. Louis Trust Company the following real estate situated in the city of St. Louis, Missouri, to-wit: (Here follows a description of the lots.)

"Now, therefore, for value received, and in consideration of the conveyance aforesaid, the said St. Louis Trust Company contracts and agrees to reconvey said real estate to said David Bailey, provided the said David Bailey shall pay to it on or before May 1, 1898, all that he now owes or may then owe to it, on his certain note, dated January 2, 1897 (secured by deed of trust recorded in recorder's office of the city of St. Louis in book 1363, at page 538), and also all other and further indebtedness which he may owe said company on any account whatsoever, including the expenses incurred in foreclosing said deed of trust.

"It is further mutually understood and agreed that the said St. Louis Trust Company may pay off and discharge any and all obligations of any nature that are or may become liens against said property, including taxes of all descriptions and costs of such repairs as said St. Louis Trust Company may make on said property, and when so paid, the same shall become part of the obligations to said St. Louis Trust Company which said Bailey is to pay to said St. Louis Trust Company before he shall be entitled to reconveyance of said property as aforesaid, and all sums of money now due or which may hereafter become due to said St. Louis Trust Company shall bear interest at the rate of six per centum per annum and become part of the obligations to said St. Louis Trust Company which said Bailey shall pay before he, the said David Bailey, shall become entitled to the reconveyance of said real estate, as aforesaid, net revenue collected by said company from said property to be credited upon said indebtedness, provided said settlement is made on or before May 1, 1898, if said indebtedness is not fully paid and discharged on or before May 1, 1898, then this agreement shall be absolutely void.

"In witness whereof, the said St. Louis Trust Company has caused these presents to be signed by its president, and its corporate seal to be hereto affixed by its secretary, and the said David Bailey has hereunto set his hand. All done the 11th day of December, A. D. 1897.

"Executed in duplicate.

"St. Louis Trust Company,

"By Thos. H. West, President.

"Attest: John D. Filley, Sec'y.

"David Bailey."

Thereupon the Trust Company entered into the possession of the premises, except one lot on which the plaintiffs resided, and thereafter managed and controlled the same as owners thereof with the knowledge and consent of the plaintiffs, paid the taxes and insurance upon all the property, placed the same in the hands of a firm of real estate agents for sale, and received the rents therefrom, except from the lot upon which plaintiffs resided, and, at intervals thereafter, rendered statements to the plaintiffs showing the receipts and expenditures on account of said property, the amount of said indebtedness, principal and interest, and the net amount due the Trust Company at the respective dates thereof. The balance due the Trust Company on May 1, 1898, on such account being the sum of $ 3,583.60. In the meantime, the plaintiff, David Bailey, had been making efforts to find a purchaser for the property; but failing to do so and being unable to comply with the terms of said agreement, he made application to the Trust Company for an extension thereof, which upon the payment of $ 1,000 by the said plaintiff, Mary Hunt Bailey, on said account, and the assignment by said David of his interest in the agreement, to her, was granted. The extension and assignment were endorsed on the agreement, and are as follows, to-wit:

"St Louis, May 27, 1898.

"For value received the within agreement is hereby continued in full force between the parties hereto, for a period of six months from this date; that is to say, the said David Bailey or his assignee, Mary Hunt Bailey, shall have the right to redeem the property described in the within contract, subject to its terms at any time prior to November 24, 1898. By granting this extension, the St. Louis Trust Company is not to forfeit or waive any rights acquired hereunder except as to extension of time.

"St Louis...