Cooper v. Burns

• Decision Date: 11 November 1904
• Docket Number: 111.
• Citation: 133 F. 398
• Parties: COOPER v. BURNS, et al.
• Court: U.S. District Court — District of Nebraska

133 F. 398

COOPER v. BURNS, et al.

No. 111.

United States Circuit Court, D. Nebraska.

November 11, 1904

Flansburg & Williams, for complainant.

George H. Thomas and A. M. Post, for respondents.

MUNGERDistrict Judge.

The material facts necessary to a proper consideration of this case are as follows:

In July, 1877, one Daniel Foley died intestate, seised in fee of real estate in Platte county, Neb., occupied by himself and family as a homestead, described as the northwest quarter (N.W. 1/4) of section thirteen (13), township ten (10) west of the sixth P.M., excepting the east quarter (E. 1/4) of the northwest quarter (N.W. 1/4) of said section, containing 150 acres, more or less, according to government survey.Said Foley left surviving him as his sole heirs at law his widow Mary Foley, and two minor children, named Jeremiah Foley and Mary Foley.Subsequently, and in the year 1883, said widow intermarried with the respondent, Martin Burns, and on August 27, 1883, said Martin Burns applied to the county court for appointment as guardian of said minor children, to wit Jeremiah Foley, then aged seven years, and Mary Foley, then aged six years, and such proceedings were had in the county court that said Martin Burns was appointed such guardian in October, 1883, and he duly qualified as such in January 1884.In February, 1884, Martin Burns, as such guardian, petitioned the district court of Platte county for a license to sell the interest of said minors in said real estate; license was granted; and said guardian afterwards reported to said district court that he had on June 12, 1884, sold the interest of his wards, said minors, in said real estate for the sum of eleven hundred dollars ($1,100) to one James Cooney; and on June 20, 1884, said sale was by the court confirmed, and the said guardian directed to execute a deed to said James Cooney.On June 23, 1884, Martin Burns, as guardian, made his deed to James Cooney, and on the same day said James Cooney by deed reconveyed the said premises for the same stated consideration to said Martin Burns.Both of said deeds were filed for record on the 3d day of July, at the same hour.No consideration passed between Martin Burns and James Cooney for said deeds, but said estate was purchased by James Cooney at said guardian sale pursuant to an agreement entered into between him and said Martin Burns that he, James Cooney, should purchase the same for and on behalf of said Burns.March 4, 1889, Martin Burns and wife executed and delivered to the Globe Investment Company, for a consideration of eighteen hundred dollars ($1,800) paid to Martin Burns, a note, with interest coupons, secured by a mortgage upon the real estate before mentioned, which mortgage contained, among other things, the following statements and covenants:

'This indenture made on the 4th day of March, in the year of our Lord one thousand eight hundred and eighty-nine, between Martin Burns and Mary Burns, his wife, of the County of Platte, and State of Nebraska, parties of the first part, and the Globe Investment Company, a corporation established under the laws of the Commonwealth of Massachusetts and having its principal place of business in Boston in the County of Suffolk and said Commonwealth, party of the second part.

'Witnesseth: That said party of the first part in consideration of Eighteen Hundred Dollars, paid by said party of the second part, the receipt whereof is hereby acknowledged, do hereby grant, bargain, sell and convey unto the said party of the second part and its successors and assigns forever, all the following described tract, piece or parcel of land situate in the County of Platte, and State of Nebraska, to-wit:

'To Have and to Hold the same with all and singular the emblements, hereditaments and appurtenances thereunto belonging, or in any wise appertaining, unto the said party of the second part, and its successors and assigns forever, and the said parties of the first part do hereby covenant and agree that at the delivery hereof they are the lawful owners of the premises above described, and are seized of a good and indefeasible estate of inheritance therein, free and clear of all incumbrances; and that they will warrant and defend the same in the quiet and peaceable possession of said party of the second part and its successors and assigns against the lawful claims of all persons whomsoever.'

-- And at the same time executed a second mortgage to said Globe Investment Company upon the same real estate to secure the sum of one hundred and eighty dollars ($180), which second mortgage recited that it was subject to said first mortgage of eighteen hundred dollars ($1,800).At the time the Globe Investment Company made said loan and took said mortgage, it had actual knowledge of the proceedings had in both the county and district courts relative to the before-mentioned proceedings, and the record of said deeds from Martin Burns guardian to James Cooney, and from James Cooney to said Martin Burns, but did not have actual knowledge of the agreement between Martin Burns and James Cooney that such purchase by James Cooney was for the benefit of said Martin Burns, or that said conveyances were without consideration.March, 1889, said Globe Investment Company transferred said note and mortgage for eighteen hundred dollars ($1,800) to one Percival Burney, and indorsed said second note and mortgage for one hundred and eighty dollars ($180) in blank.In March, 1892, said Martin Burns filed in the county court of Platte county an account and report of his acts and doings as such guardian, in which report he charged himself with eleven hundred dollars ($1,100) as the proceeds of the sale of the interest of his wards in said real estate, and credited himself with the sum of two hundred and sixty-five dollars and forty-five cents ($265.45), prior incumbrance on said land paid off, and seventy-five dollars ($75) attorney fees, and for the keeping, clothing, and maintenance of said minors a sum exceeding the remainder of said eleven hundred dollars ($1,100) and interest thereon, which report was examined and approved by the county judge.In June, 1892, one J. Lowell Moore, as trustee, brought an action in the district court of said Platte county to foreclose said second mortgage of one hundred and eighty dollars ($180).Martin Burns, Mary Burns, the Globe Investment Company, and other subsequent lien holders were made partiesdefendants.The Globe Investment Company filed its answer therein, setting up said first mortgage of eighteen hundred dollars ($1,800), claiming it to be a first lien on said premises, but that it was not desirous to have said first mortgage foreclosed, and that any decree to be entered directing a sale should be subject to the lien of said first mortgage.Such proceedings were had in said action that a decree of foreclosure and order of sale was entered in the usual form, but finding that said mortgage of eighteen hundred dollars ($1,800) was a first lien on said premises, and that a sale under said decree should be subject thereto.An order of sale was issued, and the sheriff advertised said premises to be sold under said decree, but before sale said minors, Jeremiah Foley and Mary Foley, by their next friend, W. R. Ellis, brought an action in the district court of Platte county against all the parties to the said foreclosing action, joining with them the sheriff, praying that the guardian sale from Martin Burns to James Cooney be set aside, the license issued to said Martin Burns as guardian be revoked, that the two several mortgages to the Globe Investment Company be canceled and decreed no lien upon the premises, that the title be quieted in said minors as against all the defendants, and for a perpetual injunction forever restraining the enforcement of said decree against said real estate.DefendantsJ. Lowell Moore and the Globe Investment Company appeared to said action and filed their joint answer therein.Upon the final hearing of said action it was decreed that the guardian sale of the interest of said minors in said real estate was fraudulent and conveyed no title; that the mortgage was only a lien upon the life estate of Mary Burns; and enjoined the sale under said decree of any greater interest in said premises than the life estate of said Mary Burns.At the time of the institution of said foreclosure suit, as well as the injunction suit on behalf of said minors, the eighteen hundred dollar ($1,800) note and mortgage was owned and held by Percival Burney, who purchased the same in March, 1889, and held the same until May 30, 1894, and was not a party to either of said actions.In May, 1894, Burney exchanged said eighteen hundred dollar ($1,800) note and mortgage with the Globe Investment Company for certain of its debenture bonds, and assigned said note and mortgage to one John Herbert, trustee, as security for such debenture bonds, with others of the same series.May 5, 1896, Mary Foley, having attained her majority, executed a quitclaim deed to said real estate to one Jeremiah Grady, and on the 27th of March, 1897, said Grady conveyed the same by quitclaim deed to said heir Jeremiah Foley.On October 24, 1899, said Jeremiah Foley died intestate, leaving no issue or children, his mother, Mary Burns, and his sister, Mary Foley, being his sole heirs.November 2, 1900, Mary Burns conveyed all her interest in said real estate to Mary Foley.October 27, 1902, said Mary Foley, then by reason of her marriage named Mary Dill, conveyed said real estate to the...