Ellis v. Sw. Land Co.

• Citation: 102 Wis. 400,78 N.W. 747
• Parties: ELLIS v. SOUTHWESTERN LAND CO. ET AL.
• Decision Date: 14 March 1899
• Court: Wisconsin Supreme Court

102 Wis. 400

78 N.W. 747

ELLIS

v.SOUTHWESTERN LAND CO. ET AL.

Supreme Court of Wisconsin.

March 14, 1899.

Appeal from circuit court, Eau Claire county; W. F. Bailey, Judge.

Suit by H. C. Ellis against the Southwestern Land Company, impleaded with J. F. Ellis and others. There was a judgment for plaintiff, and defendant Southwestern Land Company appeals. Affirmed.

Action to reform a deed of real estate and recover possession of lands alleged to have been, by mistake, included therein and recover the rents and profits received by the grantee.

The complaint stated facts sufficient to constitute a cause of action of the character indicated. The material facts were put in issue by the answer. In support of the complaint the evidence established without controversy, or tended to establish, the following facts: Plaintiff, at the time of the trial, was an old man about 80 years of age. He was uneducated, a farmer by occupation, and had resided on a farm some 16 miles from the city of Eau Claire for 40 years. Defendant J. F. Ellis was a lawyer, real-estate dealer and loan agent, doing business as such in the city of Eau Claire, and had been so engaged since prior to 1876. He did most of his father's business during most of the time mentioned, and took title to himself of considerable real estate, which he and his father testified on the trial belonged to the latter. In 1876 an agreement was entered into, partly by the father and partly by the son in the father's behalf, to purchase of a Mrs. Cook the property in questionin this case, which agreement was consummated by the son conveying to Mrs. Cook 80 acres of land the title to which was in his name but which was considered the property of the father, and by Mrs. Cook conveying the property in question to defendant Ellis subject to a mortgage of $600. There was an agreement between the father and son that the latter should pay off the mortgage and reimburse himself therefor out of the income of the property, and the title was taken from Mrs. Cook pursuant to that agreement. The title to the property remained in the name of defendant Ellis till February 10, 1887, during which time it yielded a considerable income each year, all of which was received by said Ellis. In 1885 defendant Ellis had a considerable real estate, which he had accumulated in the course of his real-estate business, and he employed one Allen to assist him in conducting his business, agreeing to give Allen a one-third interest in the property for five years' services. Thereafter, up to February 10, 1887, Allen worked for Ellis, during which time the property in question was handled in the office, the taxes paid thereon and rents collected, the same as on other real estate the title to which was in the name of Ellis, but there was some talk between Ellis and Allen during that period, indicating that the property in question belonged to plaintiff. About February 10, 1887, an agreement was made between defendant Ellis and Allen, to the effect that the business they were conducting, and the property in such business, should be put into a corporation and the stock taken by the two, except such as might be necessary to enable them to complete the corporate organization. The defendant Southwestern Land Company was organized accordingly, defendant Ellis subscribing for two-thirds and Allen for one-third of the stock. To complete the scheme, intending to convey to the corporation the real estate which had been acquired in the real-estate business as aforesaid, and in which Allen was entitled to an interest, Ellis made a deed of the same to the corporation, the consideration named in the deed being $18,000. The real estate in question was conveyed by such deed. Defendant Ellis, from the time of the organization of the corporation till he sold out in 1893, as hereinafter mentioned, was its president, treasurer and one of its board of directors, and controlled its business and handled all the property owned by the corporation, very much the same as before the conveyance heretofore mentioned was made. All the income from the business, and the income from business conducted by Ellis outside the corporation, went into a common fund, which was deposited in Ellis' name. Out of that fund Ellis took money as he needed it, and all of the expenses of the corporation, including taxes upon its lands, were paid out of it by Ellis' personal checks. The business of the corporation was so conducted that it and J. F. Ellis were practically one. When the deed was made to the corporation it was pursuant to an offer made by J. F. Ellis to J. F. Ellis as president of the corporation. The whole affair was handled by him on both sides in making the agreement and in consummating it by the conveyance to the corporation. The income from the property in question was collected, sometimes by Ellis and sometimes by Allen, and uniformly went into the common fund in the hands of Ellis. Some written leases were made of the property, all of which were made by the corporation as lessor. The property was twice mortgaged by Ellis and his wife to secure his individual debts, while the title was in the corporation, Allen on one of the occasions knowing the facts and as notary taking the acknowledgment of the mortgage. In September, 1893, Ellis severed his connection with the corporation and conveyed to it all his property of every name and nature in consideration of the corporation agreeing to pay certain indebtedness for which he was liable. Thereafter, up to March, 1894, Ellis remained in the office of the corporation as before, and the corporation continued to collect the rent on the property in question. In March aforesaid, Ellis vacated the office of the corporation, about which time Allen, as manager, handed to Ellis the lease of the disputed property. The circumstances attending the delivery of the lease to Ellis were controverted on the evidence. Ellis testified that Allen handed him the lease, stating that the property did not belong to the corporation. Allen said that the lease was delivered to Mr. Ellis as the result of a determination by the corporation to make...