Draper v. J.B. & R.E. Walker, Inc.

• Decision Date: 13 April 1949
• Docket Number: 7214
• Citation: 115 Utah 368,204 P.2d 826
• Parties: DRAPER v. J.B. & R.E. WALKER, Inc
• Court: Utah Supreme Court

204 P.2d 826

115 Utah 368

DRAPER v. J.B. & R.E. WALKER, Inc

No. 7214

Supreme Court of Utah

April 13, 1949

Appeal from District Court, Third District, Salt Lake County Clarence E. Baker, Judge.

Suit by Pherrell Draper against J. B. & R. E. Walker Incorporated, to quiet title to realty and to recover damages. From a judgment for the plaintiff, defendant appeals.

Judgment reversed and cause remanded with directions to enter judgment quieting title but denying award of damages.

McKay Burton, & White, of Salt Lake City, for appellant.

D. M. Draper, of Salt Lake City, for respondent.

Latimer, Justice. Pratt, C. J., and Wade, Wolfe and McDonough, JJ., concur.

OPINION

Latimer, Justice.

In 1935, the plaintiff, Pherrell Draper, became the owner of two tracts of land in Salt Lake County. The Old Mill Tavern, Inc. owned adjoining property and subsequently claimed title to plaintiff's lands by virtue of certain tax sale proceedings. After recording tax deeds to the property, Old Mill Tavern, Inc., on February 2, 1942, commenced an action in the district court to quiet title to the lands. On June 24, 1943, the district court entered its decree declaring the tax deeds to be invalid and quieted title in the plaintiff.

Before the decree was entered and while the action was still pending, the Old Mill Tavern executed and delivered a mortgage upon the lands in question to the defendant J. B. & R. E. Walker, Inc. The date of the note and mortgage does not appear, but the mortgage was filed for record in May, 1942, which was some three months after the suit was started, but some thirteen months before judgment was entered declaring the tax deeds void. The execution and recording of the mortgage was done without the knowledge or consent of the plaintiff who first learned of the transaction some time in 1947 as a result of having his abstract of title brought to date for the purpose of procuring a loan on the property. Plaintiff consulted an attorney regarding what he should do to have the cloud upon his title removed and the attorney prepared a release to be presented to and signed by defendants. The instrument together with a written demand that it be signed and executed by an officer of the defendant corporation was sent to the defendant by registered mail with a return receipt requested. Although the signed receipt was returned by the postal authorities, a reply to the letter was not received and the mortgage was not released. Plaintiff testified he made several attempts to reach Mr. J. B. Walker, an officer of defendant corporation, by telephone but was informed on each occasion that he was out of the office. He further testified that on one occasion he attempted to contact Mr. Walker personally by traveling from Salt Lake City to Ogden, Utah, a distance of some forty miles, after being told by his attorney that he, the attorney, thought the plaintiff could reach him there. This trip was unsuccessful as were two subsequent personal visits to defendant's offices and several additional attempts to reach J. B. Walker by telephone. Plaintiff was finally told by an employee of the defendant that the matter had been turned over to Mr. Burton, defendant's attorney. Upon contacting Mr. Burton, plaintiff was informed that defendant would release the mortgage if plaintiff would agree, in writing, to pay one half of the expense of having a surveyor definitely fix the boundary between plaintiff's land and the Old Mill Tavern's adjoining property. According to plaintiff he refused to participate in this proposed settlement. Two subsequent meetings between plaintiff and Mr. Burton also ended without agreement. Plaintiff testified, however, he needed the loan so badly he finally informed Mr. Burton he would accede to defendant's demand and agreed to meet in Mr. Burton's office that evening at five thirty to execute the agreement. Becoming exasperated when Mr. Burton had not arrived by about six fifteen, plaintiff left, contacted his attorney and instructed him to commence this action.

In his complaint, plaintiff, in addition to setting forth his ownership of the property in question, alleges, first, that both the Old Mill Tavern, Inc., and the defendant knew, or in the exercise of due care should have known, that the tax deeds acquired by Old Mill Tavern, Inc. were void and that the act ofplacing a mortgage on the property while the suit to quiet title was pending constituted a willful and wrongful clouding of plaintiff's title; Second, that defendant wrongfully refused to release the mortgage after demand to do so had been made upon it by the plaintiff.

In the prayer of his complaint, plaintiff asked the court to declare the mortgage null and void; that defendant be required to execute a release of the mortgage; and, that plaintiff be awarded damages in the sum of $ 547. The damages he claimed to have suffered were specifically alleged to be as follows: $ 150 as the amount he was required to deposit with a mortgagee as security against the cloud upon the property; $ 225 for attorneys fees for the preparation of papers and prosecution of his action to quiet title; $ 172 as the amount he lost in time and wages in negotiating for a release and procuring data for his counsel in this action.

In its answer, defendant admitted ownership of the property in plaintiff, disclaimed any interest therein and consented that judgment quieting plaintiff's title be entered against the defendant. It denied that it was charged with knowledge that its tax title was void at the time the mortgage was executed, and denied that it had refused to release the mortgage.

The trial court found plaintiff had suffered damages in the amount of $ 225 for attorney's fees and $ 172 for plaintiff's loss of wages and time. A judgment was entered quieting title in the plaintiff, ordering defendant to execute a release of the mortgage and decreeing that plaintiff recover damages in the amount of $ 397, together with his costs.

The single question to be decided on this appeal is whether the court below committed error in its award of damages. Under the pleadings the first issue raised is whether defendant knew, or ought to have known, when it accepted the mortgage and had it recorded that the Old Mill Tavern's tax deed was void. The record on this question discloses that Old Mill Tavern, Inc. instituted the original action to quiet title to plaintiff's property on the strength of its tax titles. Absent a contrary showing, that action alone would indicate...