Brewer v. Yancey

• Decision Date: 28 May 1923
• Docket Number: 18
• Citation: 251 S.W. 677,159 Ark. 257
• Parties: BREWER v. YANCEY
• Court: Arkansas Supreme Court

251 S.W. 677

159 Ark. 257

BREWER v. YANCEY

No. 18

Supreme Court of Arkansas

May 28, 1923

Appeal from Conway Chancery Court; W. E. Atkinson, Chancellor reversed.

Decree reversed and cause remanded.

B T. Coulter and W. R. McHaney, for appellants.

The instrument was given, conveyance made, to secure a debt, and was in effect only a mortgage. The grantor was ignorant and illiterate, and the instrument was not read over to him. 30 A. 672; 5 Neb. 247; 88 N.Y.S. 385. Brewer relied on Sutton confidently to attend to his business properly for him. 91 N.Y.S. 917; 26 Ark. 610; 85 Ark. 363; 101 Ark. 558. The bank's contention that the conveyance was made to satisfy balance due of Brewer's mortgage debt will be carefully scrutinized. 192 Ill.App. 318. Inadequacy of price also entitled to great weight in showing deed intended as mortgage. 193 S.W. 264; 86 Ark. 460. The test is the continued existence of the debt it was given to secure. 88 Ark. 229; 100 P. 1031; 114 P. 224. Further advances were made on the strength of the conveyance, and Brewer was allowed to continue long in possession of the lands without notice that the bank claimed them. The written evidence shows that the conveyance was not an absolute one. 13 Ark. 112; 174 S.W 1154. Other cases in point. 78 Ark. 527; 88 Ark. 336; 174 S.W. 1154; 193 S.W. 264; 202 S.W. 821. The court erred in not holding the instrument a mortgage, and the decree should be reversed.

Calvin Sellers, for appellee bank.

The only question is whether or not the deed executed to the Bank of Plumerville should be held to be a mortgage. The grantor had sufficient mental capacity to execute such an instrument. The deed is in proper form, and has been of record in the recorder's office since March 6, 1911, and is presumed to be a deed. The proof is not sufficient to show instrument was a mortgage. 85 Ark. 363 and other cases cited by appellants have no application to the facts of this case. If the deed was invalid, Brewer, by accepting a bond for title thereafter for part of the lands, permitting himself to be sued thereon and making default and permitting a decree of foreclosure of the bond rendered against him, ratified the deed. 29 So. 385; 48 P. 68; 87 N.W. 748; 16 Kan. 312; 69 N.E. 542; 92 N.Y. 601. To overcome the presumption that a conveyance absolute in form is a deed, in the absence of fraud, the evidence must be clear, unequivocal and convincing. 143 Ark. 607; 132 Ark 349; 75 Ark. 551; 40 Ark. 417; 88 Ark. 297; 96 Ark. 564; 105 Ark. 314; 106 Ark. 587; 148 Ark. 654; 148 Ark. 669.

M. H. Dean, for appellees.

J. R. Yancey was a bona fide purchaser of the lands and entitled to protection as such. Before he purchased the lands from the bank, he was informed by Brewer that the lands belonged to the bank, and he was looking after the timber for the bank. The record showed he had conveyed the lands by warranty deed. 28 S.W. 356; 49 Ark. 207; 36 Iowa 664; 50 S.E. 382; 90 S.W. 431; 23 S.W. 257; 108 Ark. 490; note 13 L. R. A. (N. S.) 68.

Sam M. Yancey not an innocent purchaser, not having paid whole consideration. 44 Ark. 48; 49 Ark. 207, cited by appellee, was overruled in 54 Ark. 273. Sam M. Yancey pleads that his vendor, J. R. Yancey, was an innocent purchaser. J. R. admits the Brewers were in possession when he purchased, and claiming an interest in the lands. Eng. & Am. Enc. 513; 40 W.Va. 540; 54 Ark. 273.

OPINION

HUMPHREYS, J.

On February 21, 1910, William Brewer was the owner of a 627-acre tract of land in Conway County, Arkansas. He resided with his family upon the land, four hundred acres being under fence, and three hundred acres thereof in cultivation. Five sets of improvements were upon the property. Brewer was a negro of little or no education, but through his own management and industry had accumulated this large tract of land. In carrying on his business he became indebted to A. R. Bowdre & Company in the sum of $ 2,614.12, as well as to the Bank of Plumerville. The bank took over the indebtedness of A. R. Bowdre & Company, and, in order to secure that and the amount due it, took a mortgage from Brewer for $ 4,500 on said date, February 1, 1910, covering the entire tract of land. On the 4th day of March, 1911, William Brewer and his wife, Emma, whom he had married after the execution of said mortgage, executed a warranty deed for these lands to the Bank of Plumerville for a recited consideration of $ 4,000. The main issue involved in this suit is whether said warranty deed, absolute upon its face, was in fact a mortgage to secure the balance due, covered by the mortgage given on February 21, 1910. Two other issues, incidental to the main issue, were presented by the pleadings, the first being whether M. C. McKindra and Sam M. Yancey are innocent purchasers of certain parts of the tract of land, purchased respectively by them, and the second being the amount of the indebtedness secured by the deed, if in fact a mortgage. We incorporate herein an excerpt from the narrative of appellant giving a succinct statement of the proceedings and substance of the various pleadings presenting the issues in the case. It is as follows:

"This suit had its origin in the circuit court of Conway County. On January 17, 1918, J. R. Yancey and the Bank of Plumerville joined in a suit in unlawful detainer against Alonzo and Elijah Brewer, alleging ownership in Yancey, by purchase from the bank, of the SW1/4 and the south 2/3 of the SE1/4 of sec. 26, of the lands in dispute, and praying for possession. The Brewers were ousted. They answered denying the allegations of the complaint. This suit was No. 1493. On February 28, 1918, the bank filed an attachment suit in the court of C. E. Millen, a justice of the peace, against Elijah Brewer, to collect certain rents from him for a part of these lands. This cause was appealed to the circuit court, and became cause No. 1507. On October 7, 1918, William Brewer and his sons, Charlie and William Jr., filed in cause No. 1493 an intervention in the nature of a bill of discovery, asking for a disclosure of the rights under which plaintiffs claimed title and for a transfer of the cause to equity. On November 21, 1918, the circuit court made an order consolidating the two causes and transferring them to equity, where they became cause No. 1917, which is the case at bar. On December 30, 1919, after certain discoveries, and by permission of the court, the original defendants, Alonzo and Elijah Brewer, joined their father, William, and their two brothers, Charlie and William Jr., in an amended intervention and cross- complaint, alleging ownership of the lands in dispute, together with the remaining portion of the entire 627-acre tract, making M. C. McKindra, who had purchased from the bank the SW1/4 of sec. 25, a cross-defendant, praying for a reformation of the instrument of March 4, 1911, and for Yancey and McKindra to be declared purchasers of the parts of these lands claimed by them with notice of the rights of the Brewers. With all these parties properly in court, the cause was heard on August 14, 1920, the instrument of March 4, 1911, was declared to be a mortgage, and Yancey and McKindra were declared to be purchasers of the parts of the lands claimed by them with notice of the rights of the Brewers. On September 11, 1920, this decree was vacated on motion of Sam M. Yancey, who filed an intervention alleging ownership by purchase from J. R. Yancey of the lands described in the original complaint. On September 20, 1920, the decree of August 14th was reentered, reserving to Sam M. Yancey his rights of intervention. On this same date E. H. Coulter and T. M. Williams filed their interplea in the cause, alleging that Coulter had become the owner of the south 2/3 of the SE1/4 of sec. 26, by purchase from William Brewer, and that he had conveyed the same to Williams. On January 6, 1921, on motion of plaintiffs and Sam M. Yancey, the decree of August 14 and September 30 was again vacated. On a rehearing of the cause on November 30, 1921, the court held the instrument of March 4, 1911, to be a deed absolute, and, in keeping with that finding, granted other relief. On that same date a motion was filed to vacate the decree, and, in order to save the rights of the parties over to the ensuing term, the decree was vacated for the purpose of hearing the motion at a later date. An order was made on April 19, 1922, overruling this motion and reentering the decree of November 30, 1921, as of the date of April 19, 1922. From this order and decree the Brewers, Coulter and Williams perfect this appeal.

The trial court did not have occasion to decide either incidental issue. It was admitted that on November 30, 1917, the Bank of Plumerville executed and delivered to J. R. Yancey a deed to 267 acres of said tract, which he conveyed to Sam M. Yancey on December 23, 1919; and that said bank conveyed 160 acres of said tract to M. C. McKindra on January 28, 1919. After finding that the deed executed by William Brewer and Emma Brewer, on March 4, 1911, was executed and delivered as a deed and not as a mortgage, it follows that Yancey and McKindra were entitled to the lands conveyed to each by the bank, and that it was unnecessary to state an account between the bank and William Brewer. The court therefore decreed the lands to the Bank of Plumerville, Sam M. Yancey, and M. C. McKindra, according to their several interests as shown by their deeds, and dismissed the suits of appellants for the want of equity.

Appellants contend for a reversal of the decree upon the ground that the testimony shows the deed was given to secure the balance due on the preexisting mortgage indebtedness. Testimony was introduced pro and con as to the capacity of William Brewer to execute the instrument in question,...