Benton Land Co. v. Zeitler

• Decision Date: 11 May 1904
• Citation: 81 S.W. 193,182 Mo. 251
• Parties: BENTON LAND CO. v. ZEITLER et al.
• Court: Missouri Supreme Court

81 S.W. 193

182 Mo. 251

BENTON LAND CO. v. ZEITLER et al.

Supreme Court of Missouri.

May 11, 1904.

MORTGAGES — DEEDS OF TRUST — INTEREST OF PARTIES — DEBT — MATURITY — PAYMENT — MORTGAGEE IN POSSESSION — PROFITS — ACCOUNTING — FORECLOSURE — SALE — EJECTMENT — DEFENSES — OUTSTANDING TITLE.

1. A case must be tried on appeal on the same theory and issues on which it was determined in the trial court.

2. Where, after the sale of land subject to certain trust deeds, the cestui que trust agreed to accept a new deed of trust from the grantee in place of the trust deed, which was then a first lien on the property, and a second deed of trust was thereupon executed and accepted by such cestui que trust, such acceptance constituted a discharge of the first deed of trust.

3. An outstanding mortgage or deed of trust, without entry or foreclosure, though the condition has been broken, is not a bar to a recovery in ejectment as between persons not claiming under such mortgage or deed of trust.

4. Where a mortgage or deed of trust has been foreclosed, and the legal title has been transmitted to a purchaser at the foreclosure sale, such title constitutes an outstanding title which will defeat ejectment, even between third persons not claiming thereunder.

5. A trustee under a deed of trust holds the legal title to the property as security only for the payment of the debt, and on obtaining possession before foreclosure he is bound to collect the rents and profits and apply the same to the payment of the debt, and, when paid, the title reverts to the grantor without conveyance.

6. That a conveyance was beneficial to the grantee, and that he thereafter dealt with the property as owner by giving deeds of trust thereon, and then conveyed the equity of redemption to plaintiff, was sufficient to sustain a finding of fact that the deed was delivered.

7. Where, after the execution of a deed of trust securing a debt to mature August 1, 1903, a recorded agreement was entered into between the beneficiary and the holders of the title that such debt should mature September 1, 1896, and, the same not being paid, the deed was foreclosed on February 25, 1898, a contention, by one acquiring title with notice of such agreement, that there was no installment of the debt due at the time of such foreclosure, was unsustainable.

8. In the absence of a showing that a deed of trust required the trustee to sell in parcels, the mere fact that the property was sold in bulk will not vitiate the sale.

Brace and Valliant, JJ., dissenting.

In Banc. Appeal from St. Louis Circuit Court; P. R. Fliteraft, Judge.

Ejectment by the Benton Land Company against Charles F. Zeitler and others. From a decree in favor of plaintiff, defendants appeal. Affirmed.

Hugh D. McConkle, P. W. Haberman, and Clifford B. Allen, for appellants. Johnson & Lucas, for respondent.

MARSHALL, J.

This is an action in ejectment to recover the western 15 feet of lot No. 30, and the eastern 3 feet of lot No. 29, in block 1 of the amended plat of J. B. Daggett's Second Addition to city block 1804 of the city of St. Louis, containing 18 feet on the north line of Lynch street by a depth northwardly of 114 feet, on which premises is located house No. 2309 Lynch street. The petition is in the usual form, and the ouster is laid as of October 1, 1899. The answer is a general denial, coupled with the following special defenses: First. That on October 21, 1889, one Mattie J. Sallee was the owner and entitled to the possession of the property, and that on said day she executed a deed of trust thereon to H. P. Faris, as trustee for the Brinkerhoff-Faris Trust & Savings Company, to secure an indebtedness of $1,458, which, however, was subject to a prior deed of trust made by the same parties to the same trustee and company; that default was made in the payment of the second deed of trust, it was duly foreclosed, and the plaintiff, the Benton Land Company, became the purchaser and received a trustee's deed therefor; that on August 2, 1895, the Benton Land Company conveyed the land to Southerland and La Rue; that on November 30, 1896, Sutherland and La Rue conveyed the land to Eleanore M. England, and on November 30, 1897, Eleanore M. England conveyed the land to the defendant Max Frolich, who has been in possession thereof since; that prior to the said foreclosure of said second deed of trust the equity of redemption in said property had passed from Mattie J. Sallee to A. W. Nesbit, and that the same was cut out by said foreclosure, but that notwithstanding, said Nesbit had thus lost all interest in the land, he executed on July 24, 1893, to H. P. Faris, as trustee for the Brinkerhoff-Faris Trust & Savings Company, two deeds of trust, one for $15,500 and the other for $2,785; that plaintiff's alleged right to the property is based upon and grows out of the second of said two deeds of trust; and that in consequence of all which the legal title is vested in the defendants, and not in the plaintiff. Second. That the said second deed of trust so made by said Nesbit on July 24, 1893, was payable in certain named installments, and that the same was wholly without consideration and void; that said deed of trust covered one parcel on the east side of Indiana avenue, consisting of seven lots with an aggregate frontage of 173 feet on Lynch street, on which there were 13 dwelling houses and one corner store, and also one parcel of ground on the west side of Indiana avenue, consisting of five lots with an aggregate frontage of 140 feet 4 inches, on which there were 8 dwelling houses; that on February 15, 1898, at a time when there were no installments due on said deed of trust, the trustee oppressively, illegally, and fraudulently foreclosed said deed of trust, sold the property in bulk to the plaintiff for $100 when it would have sold for enough in parcels to have paid the debt, and that the sale was collusive between the trustee and the cestui que trust, and hence the deed to the plaintiff in pursuance to said sale conveyed no title. The answer then closes with a prayer to be discharged with costs.

The reply admits that on October 31, 1889, Mattie J. Sallee was the owner and entitled to the possession of the premises, and that she executed the deed of trust for $1,458 set out in the answer, and that it was subject to a prior deed of trust for $15,000 which she had made to the same parties, and that the second deed of trust was foreclosed on June 29, 1892, and that the plaintiff became the purchaser at said sale; denies that A. W. Nesbit had no title when he executed his two deeds of trust on July 24, 1893, but alleges that Nesbit had title at that time, and avers that the first Nesbit deed of trust for $15,000 was given in lieu and substitution for the first deed of trust given by Mrs. Sallee; and denies that either of said Nesbit deeds of trust was without consideration, but avers that they represented an honest indebtedness; alleges the proper and regular foreclosure of the second Nesbit deed of trust, and the purchase of the property by the plaintiff at the foreclosure sale; and then denies all the other allegations of the answer.

At the trial the following proceedings were had: The plaintiff introduced a tripartite agreement between the Benton Land Company of the first part, Max Frolich and Eleanore M. England of the second part, and Edward S. Fish of the third part, whereby it was agreed that one ejectment suit should be brought against Charles F. Zeitler to test the right of the plaintiff to all the lots in controversy, and that the judgment had in that case should decide the right to all the lots, and that, pending the litigation, the third party, Fish, should collect the rents, pay the taxes, and attend to the repairs of all the property, and the net balance should be turned over to whichever of the litigants was adjudged entitled to the land. The plaintiff then offered in evidence a stipulation between the parties hereto, whereby it was agreed that Mattie J. Sallee was the original source of title, and that she owned the property on October 31, 1889; that John C. England is the agent of Mrs. England; that the consideration that passed from Mrs. England to Sutherland and La Rue was $1,500 in cash and certain land in Arkansas which Jno. C England valued at $2,000; that Max Frolich holds the title for Mrs. England; that between February and May, 1897, Jno. C. England paid the Brinkerhoff-Faris Trust & Savings Company interest on the two deeds of trust on the property, amounting to $518.

The plaintiff then introduced in evidence a deed of trust from Mattie J. Sallee and husband to Wm. E. Brinkerhoff and H. P. Faris, trustee for Brinkerhoff-Faris Trust & Savings Company, for $15,000, dated October 21, 1889, and duly recorded, and a second deed of trust of the same date from Mattie J. Sallee and husband to H. P. Faris, trustee for the same cestui que trust, for $1,458, which expressed that it was subject to the first deed of trust for $15,000, which was also duly recorded. The debt so secured was evidenced by seven notes, one for $550, due November 1, 1890, one for $158, due May 1, 1890, and five notes for $150 each, due on May and November 1st, respectively, thereafter. The plaintiff then offered a deed from the trustee, H. P. Faris, to the Benton Land Company, dated June 28, 1892, foreclosing the second Sallee deed of trust aforesaid for failure to pay the note for $550. The plaintiff then offered a quitclaim deed from the Benton Land Company to A. W. Nesbit, dated May 2, 1893, which was declared to be subject to the first Sallee deed of trust for $15,000. The deed was properly acknowledged, but was not recorded. The plaintiff then offered in evidence a deed of trust from A. W. Nesbit and wife to John H. Lucas and H. P. Faris, trustees for the Brinkerhoff-Faris Trust & Savings Company, dated July 25, 1893, for $15,000. This deed of trust recites that it is given and accepted in lieu and...