Balduff v. Griswold

• Decision Date: 08 February 1900
• Citation: 9 Okla. 438,60 P. 223,1900 OK 18
• Parties: FRED BALDUFF et ux. v. ONAN F. GRISWOLD.
• Court: Oklahoma Supreme Court

1900 OK 18

60 P. 223

9 Okla. 438

FRED BALDUFF et ux. v. ONAN F. GRISWOLD.

Supreme Court of Oklahoma

Decided: February 8, 1900

Error from the District Court of Kay County; before B. T. Hainer, District Judge.

Syllabus

¶0 1. REAL ESTATE--Deed--Mortgage, When. A deed absolute on its face, given as security for the payment of money, constitutes a mortgage and is governed by the law in relation to mortgages, and the agreement that it is executed as security may be in parol, and may be shown by parol evidence.

2. DEED--Security for Debt--Mortgage--Title. In order to constitute a deed, absolute on its face, a mortgage, it is not necessary that the conveyance should be made by the debtor, or by him in whom the equity of redemption will exist. It is sufficient if the debtor who claims to occupy the position of mortgagor with the right of redemption, has an interest, legal or equitable, in the premises, and the grantee of the legal title acquired such title by the act and assent of the debtor, and as a security for his debt.

3. MORTGAGE--Lien--Foreclosure--Title Passes, When. A mortgage upon real estate creates only a lien in favor of the mortgagee, and the legal title does not pass until after foreclosure and sale.

4. SAME--Right of Redemption. Where a deed is executed as security for a debt, equity will treat such conveyance as a mortgage, and permit the debtor to redeem as against the grantee at any time before his equity of redemption is foreclosed.

Pollock & Lafferty, for plaintiffs in error.

J. F. King, for defendant in error.

BURFORD, C. J.:

¶1 The defendant in error, Onan F. Griswold, plaintiff in the court below, brought this action to compel the defendants, Fred Balduff and wife, to convey to him certain real estate in Kay county, Oklahoma, and more particularly described as lot 4, in block 49, in the townsite of Hartman, now a part of Ponca City. The petition contained averments to the effect that Griswold purchased the lot from Barnes & Dalton under an oral agreement that they would convey to him, by warranty deed, when he should pay the purchase money, and that he went into possession under this oral agreement. That he occupied and improved the lot by causing a store building to be placed thereon. That afterwards Barnes & Dalton demanded payment of the balance of purchase money, and he was unable to pay the same. That he then entered into an oral agreement with defendant, Balduff, which was consented to by Barnes and & Dalton, whereby it was agreed that Balduff would loan to Griswold the sum of $ 100, to pay balance of purchase money for the lot, and that Balduff would take a deed to the lot as security for the loan. That pursuant to this agreement Balduff paid to Barnes & Dalton, for Griswold, the sum of $ 100, the balance due on the lot, and Barnes & Dalton, at the request of Griswold, conveyed the lot to Balduff, which conveyance he agreed to accept as security for the loan. It was further alleged that Griswold had tendered to Balduff the entire amount due under their agreement, and demanded a conveyance of the lot to him, which tender was refused, and Balduff claimed a forfeiture under the deed. That Balduff took possession of the lot, collected rents and refused to account for same. And an accounting was demanded, with a further prayer that the deed be decreed a mortgage, and that he be permitted to pay the amount found due Balduff, and that Balduff and wife be compelled to convey to Griswold the lot described. To this petition a demurrer was first filed, on the ground of want of sufficient facts to constitute a cause of action against the defendants. The demurrer was overruled, and exceptions saved.

¶2 Balduff then filed his answer, which consisted of a general denial, and an affirmative defense to the effect that at the time the deed was executed to him, he executed a bond for a deed to Griswold, and that by the terms of this instrument, if Griswold failed to pay the amount due him by a certain date, he should forfeit all title to the lot, and that Balduff should become the owner of the lot, and that Griswold had failed to make the payment as required, and that a forfeiture had taken effect. To the second defense Griswold replied by a general denial.

¶3 The cause was tried to the court, and finding made and judgment rendered in favor of Griswold. By the terms of the judgment and decree, it is found that Griswold is indebted to Balduff in the sum of $ 165, which is declared to be a first lien on the lot. The deed from Barnes & Dalton to Balduff is decreed to be a mortgage from Griswold to Balduff, and Griswold is given thirty days to pay the amount found due, and on payment of which Balduff and wife are ordered to convey the lot by deed to Griswold, and Balduff is allowed thirty days in which to remove the buildings placed on the lot by him. Balduff excepted to the judgment, and filed his motion for a new trial, which was overruled by the court, and the Balduffs now bring the case to this court by petition in error.

¶4 There are but two propositions presented and relied upon by counsel for plaintiffs in error in support of their assignments of error, viz: First. That the facts pleaded in the petition were not sufficient to constitute a cause of action, either to declare a resulting trust, to decree the deed a mortgage, or an ejectment. Second. The deed from Barnes & Dalton to Balduff being a warranty deed, purporting on its face to be an absolute conveyance could not be defeated or shown to be a mortgage by parol evidence.

¶5 There are other propositions argued in the brief, but they are all embraced in the above, and all the assignments of error can best be considered as a whole.

¶6 Before taking up the consideration of the questions of law presented, we desire to call attention to one statement contained in the brief of plaintiff in error, on page 2. After stating that Griswold entered into an oral contract with Barnes & Dalton to purchase the lot in question, and that Griswold failed to pay the purchase money and complete the sale, this statement appears: "After that time the plaintiff in error, Fred Balduff, purchased this lot from Barnes & Dalton, and a warranty deed was executed by them to him." The statement that Balduff purchased the lot from Barnes & Dalton, is unwarranted and inexcusable. It is absolutely without support on even contention in either pleading or testimony. It is unfair and liable to be misleading to this court. There is no dispute between the parties as to the manner in which Balduff secured the deed to the lot. Both the plaintiff, Griswold, and the defendant, Balduff, testified that Griswold, being unable to raise the money to pay the balance due Barnes & Dalton, that Balduuff loaned him the money for the purpose of completing such payment. That Balduff paid the money to Barnes & Dalton, at the request of Griswold, and took the deed as security for the loan. If it could be claimed by implication or reference that Balduff purchased the lot, under his own testimony, it was a purchase from Griswold, and not from Barnes & Dalton; but he did not claim the lot as a purchaser from Barnes & Dalton on the trial of the cause below. He claimed it by virtue of a forfeiture, and by reason of the failure of Griswold to repay the amount paid by Balduff to Barnes & Dalton for him. The testimony fully established the allegations of the petition, and failed to support the allegations of defendant's second defense. The findings of the court are fully supported by the evidence.

¶7 Did the trial court err in its application of the law? The theory of the petition was that it was an action in equity to redeem from a mortgage. That the deed, while absolute on its face, was given as security for a debt, and was in fact a mortgage.

¶8 It is contended that an oral contract for the purchase of real estate is within the statute of frauds, and cannot be enforced. We do not think this question enters into the case. The petition was good on either one of two grounds: By the terms of our statute, a resulting trust may arise by operation of law, and where a transfer of real property is made to one person, and the consideration is paid for another, a trust is presumed to result in favor of the person for whom such payment was made. (Sections 3759 and 3760, Stat. Okla. 1893.)

¶9 If, as alleged in the petition, Balduff loaned Griswold the money to pay Barnes & Dalton for the lot, and Balduff paid said money to Barnes & Dalton for Griswold, and took the conveyance to himself, then such transactions come squarely within the provisions of our statute, and the conveyance having been made to Balduff, and the consideration for the land having been paid for Griswold, a trust was presumed in favor of Griswold, and Balduff took the title to hold in trust for Griswold, and Griswold had a right to a conveyance of the land from Balduff...