Conklin v. Shaw

• Decision Date: 01 December 1919
• Docket Number: 9426.
• Citation: 185 P. 661,67 Colo. 169
• Parties: CONKLIN et al. v. SHAW.
• Court: Colorado Supreme Court

185 P. 661

67 Colo. 169

CONKLIN et al. v. SHAW.

No. 9426.

Supreme Court of Colorado

December 1, 1919

Error to District Court, Logan County; H. P. Burke, Judge.

Action by Emma F. Shaw against H. O. Conklin and others. To review judgment for plaintiff, defendants bring error.

Judgment reversed, and cause remanded.

Doud & Fowler, of Denver (George W. Wilbur, of Chicago, Ill., of counsel), for plaintiffs in error.

Munson & Munson, of Sterling, for defendant in error.

This action was brought by Emma F. Shaw, defendant in error, as plaintiff below, against H. O. Conklin, Emma Russell, and G. A. Bergtold, defendants below, plaintiffs in error here, to quiet title to a section of land in Logan county. Judgment was for plaintiff, and defendants bring the case here on error. We will refer to the parties, as in the lower court as plaintiff and defendants.

October 31, 1905, the Union Pacific Railroad Company, through its land department, entered into a land contract with one Edward Richardson, agreeing, in consideration of $1,588.50, to sell him the land in controversy. He made a cash payment of $158.85, and the remainder, $1,429.65, with interest thereand the remainder $1,429.65, with interest thereon, was to be paid in 10 annual payments, commencing October 31, 1906, and ending October 31, 1915. There was a provision that, in case of default in making any of these payments, the land should revert to, and the title reinvest in, the company, and all that had been paid thereon should be forefeited to the company and treated as rent for the use of the land.

Some time prior to March 2, 1906, one Willis Shaw, husband of plaintiff, negotiated with Richardson for the purchase of this contract in consideration of $1,747.35, which was paid to him in cash by Shaw. The three defendants each agreed with Shaw to take a one-tenth interest with him in this contract and each defendant paid Shaw $175, being his pro rata share of one-tenth of the purchase price that Shaw paid Richardson for the assignment, and on March 2, 1906, Shaw made a written declaration of trust containing, inter alia the following:

'It is further understood that as soon as said fund has been secured [$175 from each of the three defendants] I shall purchase said lands in my own name as trustee and hold such title thereto as may be acquired for each and all of the parties who may advance money therefor, and subject to such direction and order as they shall hereafter give me by a majority vote; the holders of said interests being entitled to one vote for each one-tenth interest of said lands held by them.'

March 5, 1906, Richardson duly executed the formal printed assignment to Shaw, and delivered the contract to him. March 23, 1906, the company acknowledged Shaw as the assignee of Richardson and the holder and owner of the contract, and the assignment was duly approved by the company and recorded in its office. Defendants' equitable interests in the contract were unknown to, and defendants were not recognized by, the company as having any interests therein. Under their agreement with Shaw, he was to make the subsequent payments on the contract, and pay the taxes, and notify defendants and they were each to repay to him their pro rata share upon being notified of the amount. Shaw accordingly made the 1906 1907, and 1908 payments to the company on the contract, and paid the taxes on the land, and sent defendants notice of their pro rata share which they refunded to him. This was the manner of procedure as long as he owned the contract. In 1908 Shaw went into voluntary bankruptcy, but prior thereto, on August 21, 1908, assigned the contract on the second printed form on the back thereof to his wife, Emma F. Shaw, which assignment was also duly approved and recorded by the railroad company August 26, 1908, and thereafter the company recognized and acknowledged plaintiff as the sole owner of the contract, and accepted all the payments from her, and October 26, 1915, executed to her a warranty deed.

November 20, 1909, Mrs. Shaw made a declaration of trust which was duly recorded, and, among other things, recites that the Union Pacific Railroad Company on October 31, 1905, contracted to sell the land to Richardson, and March 6, 1906, Richardson assigned the contract to Willis Shaw, and March 21, 1908, Willis Shaw assigned the contract to his wife Emma F. Shaw, and further recites:

'Whereas, G. A. Bergtold, H. O. Conklin, and Emma Russell have paid for and each own an undivided one-tenth of said contract, and hold such interests under declarations of trust from Willis Shaw, trustee, dated March 2, 1906:

'Now, therefore, this instrument is to declare that I hold title to said contract and the lands above described, when conveyed to me, in trust for the following named persons in proportions as follows, to wit: For G. A. Bergtold, one-tenth; for H. O. Conklin, one-tenth; for Emma Russell, one-tenth; and for myself, Emma F. Shaw, seven-tenths--but such interests are subject to the pro rata payment of the unpaid purchase money and other terms of said contract. And it is further understood and agreed that if any or either of said parties shall make default in any payment of his or her share, as it becomes due under said contract, and such default in payment shall continue for thirty (30) days after written notice, then such defaulting party shall forfeit all his or her right, title, and interest in and to said contract, and in and to the payments then made thereon to that time. The others in interest, or either of them, may make such payment, and thereupon such defaulted interest shall belong to those paying for the same, in proportions of their respective payments on such defaulted payment.'

Mrs. Shaw, after receiving the deed, began this action against defendants to quiet title in her to the land. The complaint is in the usual form--that she is the owner in possession of the land, and that defendants each claim some right, title, or interest therein, which is unfounded. Defendants allege that, about March 2, 1906, they each acquired a one-tenth interest in the contract and they plead the declaration of trust made by plaintiff November 20, 1909, and allege that they at all times have been ready and willing to pay their pro rata share, but were unable to obtain from plaintiff a statement of the amount due from them to her. They then allege that they never received any notice of default whatsoever, and that they each own a one-tenth interest in the land. They pray that they be allowed to make such payments to plaintiff as are due or have become due to her on account of her payments on the contract, and the taxes, and that they each thereupon be declared the owner of an undivided one-tenth interest in the land. The reply alleges that on March 6, 1906, Willis Shaw purchased the contract from Richardson for the sum of $1,747.35, and admits that defendants each acquired a one-tenth interest with Shaw in this contract; that at the time of the purchase of the contract by Willis Shaw from Richardson there were deferred payments thereon as follows:

In 1906 ..	$ 85.78
1907 ..	243.43
1908 ..	160.20
1909 ..	225.12
1910 ..	215.58
1911 ..	206.70
1912 ..	196.22
1913 ..	186.68
1914 ..	178.08
1915 ..	168.54

--that defendants' interests were taken subject to the pro rata payment by each of a one-tenth of these annual payments due under the contract to the company, together with one-tenth of the taxes; that she became the owner of the contract by assignment from Willis Shaw to her in 1908; that, after she became the owner of the contract, she paid all the deferred payments and taxes, and in 1915 the company executed and delivered to her a warranty deed to the land. She then alleges that in 1909, and each and every year thereafter, defendants and each of them defaulted and made no payment whatever, and that they were each served with written notice of their default in the first year in which it occurred, but neglected and failed to make any of the payments.

In 1906, 1907, 1908, and 1909 the trustee made the payments to the company on the contract, and the taxes, and notified the defendants of their pro rata share which they remitted to the trustee. After Mrs. Shaw became trustee, she refused to give defendants any statement of the amounts due, though often requested to do so, and defendants made no further payments to her. In December, 1909, one of the defendants wrote to her as follows:

'In regard to the several talks that we have had over the telephone in reference to my one-tenth interest in all of section 1, township 11, range 52, Logan county, Colorado, of which you are the trustee, I hereby notify you that I am ready to pay my portion of the payment that was due the

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