Borth v. Proctor

• Citation: 219 S.W. 72
• Decision Date: 20 December 1919
• Docket Number: No. 20298.,20298.
• Parties: BORTH et al. v. PROCTOR et 6.
• Court: United States State Supreme Court of Missouri

219 S.W. 72

BORTH et al. v. PROCTOR et 6.

No. 20298.

Supreme Court of Missouri, Division No. 1.

December 20, 1919.

Motion for Rehearing Denied March 2, 1920.

Appeal from Circuit Court, Ripley County; J. P. Foard, Judge.

Suit by Alice Borth and others against Nellie Proctor and others. Decree for plaintiffs, and defendants appeal. Affirmed.

Charles L. Ferguson, of Doniphan, and Ed. L. Abington and Sam M. Phillips, both of Poplar Bluff, for appellants.

James F. Fulbright, of Doniphan, and J. C. Sheppard and Arnot L. Sheppard, both of Poplar Bluff, for respondents.

GOODE, J.

This is an appeal in a suit to set aside a sale made by a trustee in a certain deed of trust, on payment to the purchaser of the price he paid and interest. Such was the prayer for relief, accompanied, so the petition states, by a tender of the requisite amount of money. The deed of trust was signed May 8, 1913, by Alice Borth and Herman Borth, her husband, Pauline Barrett and R. C. Barrett, her husband, and the Borth Mercantile Company, was acknowledged by said parties the next day (May 9th), and recorded on May 12th. The trustee was C. P. Harmon, the beneficiary the Ripley County Bank, a corporation, and the debt secured was a promissory note of even date with the deed of trust, made by all the grantors to the Ripley County. Bank, and by which they promised to pay said bank $2,500 one year after the date of the note, with interest from maturity at the rate of 8 per cent. The property covered was a part of lot 10 of New addition to the city of Doniphan, Mo.; the part conveyed being described by metes and bounds, which need not be recited. There were the usual provisions regarding a sale of the property by the trustee in the event the note was not paid when due. The note was subsequently transferred, without recourse, by the Ripley County Bank, to A. H. Schott, who lived in Illinois. A renewal note was taken for the original one May 8, 1915, but whether this was transferred to Schott is not shown, though Gerlach, the cashier, swore Schott owned the note at the date of the sale. Five hundred dollars were paid on the principal, and the interest was paid up to May 8, 1915. A second deed of trust to secure a debt of $1,000 was given on the property to T. L. Wright; said deed of trust embracing other lots. Harmon, the trustee in the first deed of trust, was president of the Ripley County Bank, and Wright, the beneficiary in the second deed of trust, was president of the Doniphan State Bank. Default having been made in the payment of the note secured by the first deed of trust, the trustee therein, C. P. Harmon, at the request of the holder of the note, advertised the property for sale. The notice and the publication of it were sufficient in all respects, and stated that on account of the default the property (describing it) would be sold at the courthouse door in the city of Doniphan, Ripley county, state of Missouri, between the hours of 9 o'clock in the forenoon and 5 o'clock in the afternoon on the 11th day of June, 1915. It is charged in the petition that Harmon conducted the sale secretly and fraudulently against the interest of plaintiffs, for the purpose of having the lot bought for less than its value, to enable the Ripley County Bank to realize a profit out of it and to gratify a grudge he cherished against plaintiffs on account of having lost some money in the Borth Mercantile Company. The evidence shows a meeting of certain officers and stockholders of the Ripley County Bank was held the night before the sale was to occur, when a discussion took place as to who should bid at the sale to protect the interest of the bank, but no decision was reached. Harmon, the trustee, of course could not buy the property, and, according to the testimony for defendants, S. A. Proctor, who was vice president of said hank, did not wish to buy it, nor did J. D. Gerlach, the cashier. It was agreed the sale should take place at 1 o'clock. T. L. Wright, holder of the second deed of trust, wished to bid at the sale and intended to bid enough to cover the debt secured and the costs of sale; intended to do this both for his own benefit as holder of the note secured by the second deed of trust, and pursuant to an arrangement with the Borths and Barretts, who owned the ground, to protect their interests, that is, he would buy it and hold it for them to redeem by reimbursing him what he paid for it, plus the amount of his own debt, secured, as said, by a second deed of trust. On the morning of the day of the sale R. C. Barrett inquired of Harmon the hour of sale, and was told it would be at 1 o'clock. Wright understood from him, or otherwise, the sale would take place at 1 o'clock. He testified he left his home after dinner, went down town, and reached the Doniphan State Bank one minute before 1 o'clock, then walked to where he was in full view of the court house, but saw nothing to indicate a sale was about to take place. At that time it was 2 or 3 minutes after 1, he said. He met a man named Burford in front of the latter's store. They talked a little while, and then went over to the courthouse 3 or 4 minutes after 1; Burford desiring likewise to bid for the property. About 30 minutes after 1, Wright saw the trustee, Harmon, and asked him when the sale would occur, and Harmon replied it had already taken place and the property had been purchased by S. A. Proctor, as it had, for $1,058. At this time a conversation occurred which was received in evidence, and its reception is assigned for error. The effect of it was as follows: Wright asked Harmon if the sale had occurred, and was told it had; then remarked, "You surely sold it before 1 o'clock," to which Harmon replied they hadn't; "that all three held their watches in their hands and they sold at precisely 1 o'clock." Harmon then said, "Dr. Proctor bought it for the bank." Wright's testimony as to the remainder of the conversation we give, as far as the same is pertinent, in ills own words:

"I says, `Well, your money is all you want, ain't it?' and I said, `It is only about 30 minutes after 1 now; go back and resell it; I want to bid on it.' He said that he didn't know whether money was all they wanted or not; he said that Borth and Barrett had beat him out of some money, and he was going to see that the bank got their money whether he got any of his or not; he said they had worked on him religiously and Masonically in getting things done for them by him, and that they were going to make what they could out of the property."

Harmon had asked his attorney, Charles L. Ferguson, to conduct the sale, but the latter advised Harmon he would have to do it himself. No one was present when the property was sold except Harmon, said attorney and Proctor, who bought it in. These three men testified the sale occurred precisely at 1 o'clock and was conducted by the notice being first read and bids asked for, and that no one bid but Proctor. Harmon said he did not tell any one while on the way to the courthouse, the sale was to occur. The trustee made Proctor a deed, and this action was originally instituted against him and stood against him when it was decided in the circuit court, but, he having since died, it has been revived against his heirs at law. There was some testimony by county officials, who had their offices in the courthouse, that they were in them at 1 o'clock and heard no sale cried; but the evidence is rather weak, as they could not remember whether or not their office windows were open. There was also testimony to show it was the custom in Doniphan, in making sheriff's and trustee's sales, to attract as many bidders as possible by crying the sale in loud tones. The evidence was quite contradictory as to the diligence of Wright and Burford in attempting to be present at the sale, and some of it indicates they acted with indifference and did not go to the courthouse, or toward it, until 15 or 20 minutes after 1 o'clock. There is evidence to show Proctor bought...