Burton v. Pepper

• Decision Date: 26 November 1917
• Docket Number: 19247
• Citation: 116 Miss. 139,76 So. 762
• Court: Mississippi Supreme Court
• Parties: BURTON ET AL. v. PEPPER ET AL

76 So. 762

116 Miss. 139

BURTON ET AL. v. PEPPER ET AL

No. 19247

Supreme Court of Mississippi

November 26, 1917

Division B [Copyrighted Material Omitted]

APPEAL from the chancery court of Holmes county, HON. A. Y WOODWARD, Chancellor.

Bill for appointment of receiver by D. G. Pepper and other against R. L. Burton and others. From a decree overruling a motion to revoke a decree appointing a receiver, defendants appeal.

In the year 1914 appellant Burton was the tenant of, and appellee D G. Pepper was the owner of, the two plantations in Holmes county known as Winter Quarters and Famosa. The term of the written lease was a period of five years, beginning in 1914, and the annual rent agreed upon was three thousand dollars, due November 1st of each year. Prior to the execution of this lease Mr. Burton had completed a five-year lease, and during this time the landlord appears to have furnished Burton with money with which to make his crops. In the beginning of the year the parties would agree upon an amount to be furnished and thereupon Mr. Burton, the tenant, would execute his note for the sum agreed upon and secure the same by a deed of trust upon the live stock, agricultural implements, and the crop to be raised that year. In the year 1914 the parties agreed upon an advance of eight thousand dollars. In addition to the security mentioned, there was embraced in the deed of trust about one hundred acres of wild lands in Issaquenna county. Appellee, Capt. D. G. Pepper, resided at Sardis, Miss., and his son, Hon. A. M. Pepper, at Lexington, Miss., assisted his father in looking after the plantations and in concluding arrangements with the tenant. In furnishing money to the tenant Mr. Burton would execute his note and trust deed, and the promissory note and security would then be taken by Mr. Pepper and assigned to the Bank of Lexington which placed the proceeds to Mr. Burton's "plantation account." This account would be drawn upon at intervals as agreed on by Burton and Mr. A. M. Pepper. It appears that Mr. Burton made rather a short crop in 1914, and that cotton at the close of this year was selling at a very low price, said to be due to the European war and a generally depressed cotton market. Instead of selling the cotton raised in 1914, the tenant, by agreement of the parties, delivered to Captain Pepper and the Bank of Lexington the receipt for seventy-nine bales of cotton in the compress at Greenwood, and one hundred and fifteen bales with Montgomery Bros., at Yazoo City, to be held by the landlord for better prices. In February, 1915, the landlord agreed to advance Burton six thousand dollars, with which to make and gather the crop in 1915. To this end Mr. Burton executed the usual note and deed of trust, and by agreement the deed of trust not only secured the advances to be made in 1915, but expressly recited that it was to secure any balance then due by Burton to his landlord upon the unpaid indebtedness of 1914. The note and deed of trust for 1915 were executed, and by the landlord indorsed to the Bank of Lexington and filed for record. After the trust deed had been filed for record, appellee claims that Mr. Pepper then for the first time examined the records in the clerk's office and to his surprise discovered that Mr. Burton had executed two deeds of trust to the Bank of Belzoni in Washington county, covering some of the live stock embraced in the deed of trust given Mr. Pepper. There was then some negotiation between the parties seeking to have the liens in favor of the Bank of Belzoni satisfied or canceled, or if this could not be done to have the Bank of Belzoni make the advances for 1915. Mr. Burton did not succeed in having these liens canceled, and thereupon by agreement with A. M. Pepper, Mr. Burton went to Yazoo City to induce the Yazoo Grocery Company, one of his creditors, to make the advances for 1915. Mr. Burton took with him upon this mission a letter of recommendation from A. M. Pepper. Mr. Burton did not succeed in getting the Yazoo Grocery Company to advance supplies for the year 1915, and Captain Pepper thereupon declined to make the advances or to have the Bank of Lexington do so. In this state of affairs Capt. D. G. Pepper, acting through his son, on March 9, 1915, filed his bill of complaint in this cause against Mr. Burton, asking that a receiver be appointed to take charge of the plantations and all personal property of R. L. Burton embraced in two deeds of trust above mentioned, asking a foreclosure of the deeds of trust, and that the receiver be authorized and directed to work the plantations for 1915, or to deliver to the complainant possession in order that the complainant might work or re-lease the same. The bill of complaint with exhibits thereto was then presented to the chancellor in vacation, without any notice to the defendant Burton, and the chancellor, on March 10, 1915, appointed C. H. Campbell as receiver. The receiver took possession of the plantations, and, acting under decrees from the court, planted crops for the year 1915, and was cultivating the lands and operating the plantations, when at the May term, 1915, Burton filed a motion to revoke the appointment of a receiver, and asking that if the court could not revoke and set aside generally the decree appointing the receiver, then to alter the decree which authorized and directed the receiver to take charge of the live stock and personal property embraced in the deeds of trust, and allow the defendants to bond same. Before the May term of court, the defendant Burton filed a general answer denying the material equities of the bill. In April the complainant amended the original bill in which it is averred that some of the mules had been unlawfully taken by Burton, the Bank of Belzoni, and other parties, from the possession of the receiver by means of a fictitious replevin suit, and the amendment prayed for the issuance of an injunction to restrain the prosecution of the said replevin suit. In May also certain unsecured creditors joined in the bill. The prayer of the intervening creditors is that they be made parties complainant in this cause; that notice be given to all other creditors of R. L. Burton to come forward and file their claims with the receiver, and that all unsecured creditors be allowed their pro rata share of any and all assets remaining after the secured creditors have been satisfied. These unsecured creditors are represented by the same counsel who filed the original bill. On May 24, 1915, notice was served by the defendants that their application to the court, asking that the appointment of a receiver be revoked and that the receiver be removed, would be heard at the courthouse in Lexington at the time therein stated. Formal motion was filed by R. L. Burton, challenging the right of the complainant to have a receiver appointed, and asking that the appointment be altogether revoked. There was also an alternative prayer by the defendant that, in event the motion to revoke the appointment should be overruled, the order of appointment should at least be modified so as to permit the defendant Burton to execute a forthcoming bond for the live stock and other personal property conditioned according to law, and to abide the final decree of the court. J. W. McClintock, Bank of Belzoni, Grenada Bank, and the trustees in the trust conveyances executed by Burton to the Bank of Belzoni and Grenada Bank, the defendants interested in certain of the mules and horses pledged to said banks, joined the defendant Burton in asking for the removal of the receiver, and also joined in the request that the defendant Burton be allowed to give bond for the personal property involved in this suit. These motions were duly presented to the chancellor, and the court, upon consideration of the pleadings, motions, and certain oral testimony, overruled the motions of the defendants. From this interlocutory decree overruling the motions of the defendants, an appeal by permission of the chancellor is prosecuted to this court. The complainants offered as witnesses C. H. Campbell, the receiver, Vess Simms, a negro tenant, J. A. Long, M. L. Smith, and A. M. Pepper, to show the general condition of the plantations and the live stock at the time the receiver took charge, and what was being done with the plantations pending litigation. Capt. D. G. Pepper also testified in his own behalf. The following letters were also introduced as exhibits to the testimony of the witness A. M. Pepper:

"Lexington Miss., February 15, 1915. Mr. R. L. Burton, Belzoni Miss.--Dear Mr. Burton: Confirming my telephone conversation with you yesterday I beg to say that I received a letter from father Saturday evening in reply to a letter from me in reference to advancing you money to make and gather the crop for 1915 on his Winter Quarters and Famosa plantations. He advises me that he has decided he can do nothing further in that direction, in view of the fact that you have leased another place and given other deeds of trust on part of your stock to other parties, all of which we have discovered since you were here a few days ago. He is also of the opinion that under the circumstances there would be considerable doubt of your ability to pay the proposed advances for 1915 and rent for 1915 and the balance due for rent and supplies in 1914 out of the crops of 1915, with cotton at prices now prevailing and which will doubtless prevail this fall. I therefore suggest that you take this matter up with the Bank of Belzoni and see if they desire to pay the balances you owe my father for rent and supplies for 1914, and to take over his securities given by you, which I trust they will decide to do for you, and make you whatever advances you may need. I am mailing you this letter by special...