Eccles v. Kendrick
| Decision Date | 18 July 1927 |
| Docket Number | 6123. |
| Parties | ECCLES v. KENDRICK. |
| Court | Montana Supreme Court |
Rehearing Denied Oct. 17, 1927.
Appeal from District Court, Powder River County; S.D. McKinnon Judge.
Action by Robert Eccles against Luther W. Kendrick. From a judgment for defendant, plaintiff appeals. Affirmed in part, and reversed in part, and remanded, with direction.
Rudolph Nelstead, of Miles City, for appellant.
Daniel L. O'Hern, of Miles City, for respondent.
Plaintiff brought this action to secure the cancellation of a $2,500 note and a chattel mortgage given to secure payment of the same, executed and delivered by him to the defendant on March 19, 1923.
The material facts, as shown by the pleadings and the testimony introduced at the trial, are substantially as follows: By an arrangement entered into about May 5, 1919, plaintiff agreed to sell to the defendant and the defendant agreed to purchase from him 120 acres of land located in Powder River county consisting of one 80-acre tract and one 40-acre tract, at $20 per acre, and on that day the defendant paid to the plaintiff $500 on the purchase price. About July 17, 1919, the defendant requested plaintiff to convey to him the land which he had purchased, whereupon plaintiff advised him that he could at that time only convey to him the 80-acre tract, but that he would be able to convey the 40-acre tract in a short time by a good and sufficient deed. Thereupon the defendant paid to the plaintiff an additional sum of $1,200 by check and also turned over to plaintiff a promissory note for $100 signed by one Haney, which plaintiff accepted as a cash payment, making a total payment at that time of $1,300, and thereupon plaintiff executed and delivered to defendant a warranty deed conveying to him the 80-acre tract. The defendant thereafter took possession of the entire 120 acres built a house and made other improvements thereon, and remained in actual possession thereof down to the month of March, 1923, using the same for general farming purposes. In the winter of 1919-20 the defendant leased to the plaintiff a portion of the above-mentioned tract and other lands for pasture at the agreed price of $500. Defendant had demanded payment of this sum from plaintiff, but the same had not been paid before the 19th day of March, 1923. Prior to the last mentioned date plaintiff had not perfected his title so as to enable him to convey the 40-acre tract to defendant, and on that date defendant demanded of plaintiff that he pay back to him the $1,800 which had been paid on the purchase price of both tracts, and in addition thereto the $500 due to him for pasture, and a further sum of $200 on account of improvements, which he had made on the land conveyed, by his labor, making a total of $2,500. The note and mortgage in question were executed at that time.
The plaintiff's theory of the case as set out in his complaint is that the note and mortgage in question were executed and delivered by him to the defendant pursuant to a mutual, contemporaneous, dependent agreement, made at that time; that the same constituted merely security to the defendant for any loss he might sustain by reason of the plaintiff's failure to obtain title to the 40-acre tract in the event he should not be able to perfect his title to the same, and with the further agreement and understanding that when he had perfected his title and had conveyed the same to the defendant, the note should be returned to him, and that the defendant should cancel the mortgage of record; that thereafter, in 1924, his title to said 40-acre tract was perfected and he thereupon executed and tendered to the defendant a warranty deed for the same, which the defendant refused to accept, and he prays in his complaint that the note may be ordered surrendered to him for cancellation and that the defendant be ordered to satisfy, release, and cancel of record the chattel mortgage given to secure the same.
In his answer the defendant admits the transaction relating to the sale of the real estate to him by the plaintiff, but alleges as a defense that the plaintiff, having failed to perfect his title to the 40-acre tract on March 19, 1923, agreed that he would take back the 120 acres of land involved in the deal and would repay to the defendant the money which he had paid on the purchase price, together with the other items, making up the total of $2,500, in which amount, he alleges, the plaintiff became indebted to him on that date, and that as evidence of this indebtedness from the plaintiff thus created, the note and mortgage in question were executed and delivered to him as security. The allegation of the answer in reference to this agreement is, "It was agreed by and between the plaintiff and defendant that the plaintiff should take back the land and should repay to defendant" the sum of $2,500 evidenced by the promissory note.
Plaintiff perfected his title to the 40-acre tract in December, 1924, and subsequently, on January 10, 1925, executed a warranty deed conveying the same to the defendant, which he caused to be recorded in the proper office on February 16, 1925. Under date of April 21, 1925, this deed was forwarded to the defendant by registered mail at his post office address, Biddle, Montana, by plaintiff's counsel, residing at Miles City. The registered letter reached Biddle on April 25, 1925, and was tendered to the defendant by the postmistress on April 30, 1925, and he refused to accept it. On March 28, 1925, the defendant executed two quitclaim deeds covering the two tracts in question, conveying the same to plaintiff, which were thereupon forwarded to him by mail. The plaintiff received these two deeds, but caused them to be returned to the defendant by registered mail under date of April 21, 1925, but the defendant refused to accept the same when tendered to him at the post office, and they were returned to the plaintiff. At the trial the plaintiff again tendered to defendant the warranty deed for the 40-acre tract, which tender was refused. On March 19, 1923, after the execution and delivery of the note and chattel mortgage, the plaintiff and defendant went to the assessor's office and had the land changed on the assessment list of the county from the name of the defendant to the name of the plaintiff, and during the years 1923 and 1924 the plaintiff returned said lands on his assessment list and paid a portion of the taxes thereon.
By appropriate allegations in his answer the defendant alleged as a counterclaim that the note was past due and unpaid, and prayed for judgment for the amount thereof and for a foreclosure of the chattel mortgage.
Issue was joined upon the affirmative allegations of the answer, and the case was tried before the court without a jury. The court found the issues against the plaintiff and entered judgment in favor of the defendant for the amount of the note and for a foreclosure of the chattel mortgage, in accordance with the prayer of the counterclaim. From this judgment the plaintiff has appealed.
While there are eleven specifications of error, they all relate to but one contention; namely, that the court erred in granting affirmative relief to the defendant on the promissory note involved, in so far as the same is evidence of the consideration to be paid by the plaintiff to the defendant for the transfer or reconveyance of the real estate by the defendant to the plaintiff, for the reason that the granting of such relief constituted in fact the enforcement of an oral contract for the transfer of real property, and that the same was not enforceable because it failed to comply with the statute of frauds, in that (1) it was not evidenced by a conveyance or instrument in writing subscribed by the party granting the same, (2) that there was no note or memorandum thereof in writing subscribed by the party to be charged, and (3) that there was no...
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