Caesar v. Capell

• Decision Date: 17 August 1897
• Parties: CAESAR et al. v. CAPELL et al.
• Court: U.S. District Court — Western District of Tennessee

83 F. 403

CAESAR et al. v. CAPELL et al.

United States Circuit Court, W.D. Tennessee.

August 17, 1897

The bill alleges that the widowed defendant and her husband in his lifetime executed a deed of trust to the plaintiff Jarvis, now a citizen of the state of New York, whereby was conveyed a tract of land, of 484 acres situated in Haywood county, Tenn., in trust to secure to the Jarvis-Conklin Mortgage Trust Company the payment of a bond for $6,000 executed and delivered by them for money loaned, due five years after date, with interest payable semiannually on the 1st days of February and August. There are no distinctive allegations in the bill setting forth the tenor and effect of the bond, but it is made an exhibit to the bill, and appears to be a coupon bond by which, five years after date, the obligors promise to pay to the order of the Jarvis-Conklin Mortgage Trust Company 'at its office in Kansas City Missouri,' $6,000, with interest at the rate of 6 per cent. per annum, payable semiannually according to the tenor and effect of the interest notes thereto attached, and of even date therewith. Then follows this recital: 'This note is given for an actual loan of the above amount, and is secured by a trust deed of even date herewith, which is a first lien on the property herein described. ' The paper is dated at Kansas City, Mo August 1, 1891, and signed by William E. Capell and Lezinka Capell. Then follow, in the inverse order of their numbers the four unpaid coupons, each for the sum of $180, No. 10 of which reads as follows:

'On August first, 1896, for value received, we promise to pay to the Jarvis-Conklin Mortgage Trust Company or bearer, at the office of said company in Kansas City, Missouri, one hundred and eighty dollars, for interest due on a principal note of six thousand dollars. This coupon note bears interest at the rate of six per cent. per annum after due.

'(Signed)

Wm. E. Capell. 'Lezinka Capell.

'Dated Kansas City, Mo., August 1st, 1891.'

The others are in the same form and words, except as to payment dates.

The bill alleges that 'said bond is now the property of complainants Caesar and Fowler, is overdue and wholly unpaid, together with interest thereon payable semiannually from August 1, 1894. ' Caesar and Fowler are British subjects, complainants in the bill along with Jarvis, the trustee. The bill alleges that the Jarvis-Conklin Mortgage Trust Company, the payee in the bond, was a corporation organized and existing under the laws of the state of Missouri, with its principal office in Kansas City, in that state, and then avers that, 'being such, was the owner of said bond, and assigned and delivered the same to these complainants for value. ' The bill again alleges that the obligors have not paid any part of the principal and interest, except as before mentioned, and contains other allegations not necessary now to be noticed. The bill does not set out the tenor and effect of the deed of trust, except so far as to state that it was made to secure payment of the bond above mentioned; but it also is made an exhibit to the bill, and prayed to be taken as a part of it. From its inspection in aid of the bill, it appears to be an indenture between William E. Capell and his wife, Lezinka Capell, of the county of Haywood and state of Tennessee, and Samuel M. Jarvis, trustee, of the county of Jackson and state of Missouri, by which they recite that they 'are justly indebted unto the Jarvis-Conklin Mortgage Trust Company in the sum of six thousand dollars, borrowed money, as is evidenced by their note of even date herewith for the sum of six thousand dollars, due and payable on the first day of August, 1896, and interest at the rate of six per cent. per annum from date until maturity. ' It also recites that the interest payments are evidenced by 10 coupons, and that said note and coupons are payable to the order of the Jarvis-Conklin Mortgage Trust Company at its office in Kansas City, Mo. In the usual form, the instrument then conveys the 484 acres of land in Haywood county by metes and bounds to said trustee or his successors, in trust, forever, releases claims of homestead and dower, waives the equity of redemption and states the trust to be that in case of default in the payment of the indebtedness, or any part thereof, according to the tenor and effect of the bond and coupons, on the application of the legal holder of the note, it shall be lawful for the trustee to sell the premises upon certain named conditions, and place the proceeds to the payment of costs and expenses of executing the trust, including the attorney's fee of $600, compensation to the trustee, and all sums paid for taxes, insurance, assessments, and charges to protect the title, and finally to the payment of the principal and interest due upon the note and its coupons. The bill prays in the ordinary form for a foreclosure, for an account, and application of the proceeds of the sale that is to be made under judicial decree according to the tenor and effect of the deed of trust itself.

The defendants appeared, and on the 5th day of June, 1897, filed their plea, by which it is averred that the Jarvis-Conklin Mortgage Trust Company at the time of the making of the loan and the execution of the mortgage was a foreign corporation organized and chartered under the laws of the state of Missouri, and that at that time, to wit, August 1, 1891, it had not filed a copy of its charter with the secretary of state of the state of Tennessee, and had not caused an abstract of same to be recorded in the register's office of Haywood county, Tenn., as required by the acts of the legislature of Tennessee (chapter 122 of the Acts of 1891 and chapter 31 of the Acts of 1877 of said state), although the said Jarvis-Conklin Mortgage Trust Company was at that time doing business in said state and in the said county of Haywood in violation of said acts (the said company having opened an office in the city of Memphis, Shelby county, Tenn., for the purpose of making loans in Haywood and other counties throughout the said state, and securing the same by mortgages and deeds of trust on lands situated in said counties in the said state), and that the said company was in fact at that time, before, and after, doing an extensive loan and mortgage business throughout the state, and also did and was doing a large business in the said county of Haywood, through the said local agencies, and in violation of said acts, and that the loan herein sued on was made through the said agencies, and in violation of said acts (the said loan being negotiated in Haywood county, Tenn., where the said William E. Capell and wife, Lezinka Capell, lived and resided, and where they executed the bond and coupons, and where they received the money for the same, and where the lands are situated which are secured in the deed of trust, and the said trust deed being also executed and acknowledged in this state); that the said company, although it did business 'as above set out' from 1890 to the year 1893, did not comply with the said act of 1897 (chapter 122) until the 30th of March, 1892, when a copy of its charter was filed with the secretary of state, and on May 16, 1892, when an abstract of the same was filed in the register's office of Haywood county, Tenn; that the said loan with its trust deed, bond, and coupons, set out and exhibited with complainants' bill, was therefore null and void; that the legislature of Tennessee, by an act of 1895 (chapter 119,) extended the time in which foreign corporations having made loans in violation of said act could file their charters, and that complainants, if entitled to recover in this case at all, are only entitled to recover under and by virtue of said act of 1895 (chapter 119), and that under this act no suit can be brought to recover thereunder within two years from the passage thereof, to wit, May 10, 1895, and therefore May 10, 1897, was the earliest possible day in which complainants' suit could have been legally instituted, and the same, having been brought on April 22, 1897, was therefore premature, wherefore the defendants pray that the same may be abated and dismissed, and demand judgment of this honorable court whether they ought to be compelled to make any answer to said bill of complaint, and pray that they may be hence dismissed with their reasonable costs in this behalf. On the 9th of June, 1897, the minor defendants, who are joined in the foregoing plea by their guardian ad litem, filed a separate plea in all respects the same as that which is above set out, the two being copies of each other.

Scruggs & Henderson, for plaintiffs.

Lee Thornton, for defendants.

HAMMOND, J. (after stating the facts as above).

The pleas in this case are somewhat inartificial. They are, in the first place, without leave of the court, double, inasmuch as they set up matter both in bar and in abatement. They also do not within themselves state all that is necessary to render the pleas a complete equitable bar to the case made by the bill, by clear and distinct averments of the facts themselves, but deal mostly in mere conclusions of fact and law drawn by the pleader from the undisclosed circumstances or supposed facts of the case. Also they ignore certain material facts stated in the bill, bearing upon the issue tendered by the pleas. For instances, it appears by the bill that the note and coupons were dated at Kansas City, Mo., and were to be paid there; also, it appears by the deed of trust that it was given for a note and coupons payable to the Jarvis-Conklin Mortgage Trust Company at its office in Kansas City, Mo.; and thus upon the very face of the contract itself, both as to the indebtedness and the security, it is recited that the...