Ferguson v. Robinson

• Decision Date: 20 May 1914
• Citation: 167 S.W. 447,258 Mo. 113
• Parties: PAULINE FERGUSON, Appellant, v. W. M. ROBINSON
• Court: Missouri Supreme Court

167 S.W. 447

258 Mo. 113

PAULINE FERGUSON, Appellant, v. W. M. ROBINSON

Supreme Court of Missouri

May 20, 1914

Appeal from Jasper Circuit Court. -- Hon. David E. Blair, Judge.

Affirmed.

J. J Nelson, R. M. Sheppard, Norman A. Cox, Howard Gray and Hugh Dabbs for appellants.

(1) Defendant, Robinson, agreed with Parker, before, and at the execution sale at Joplin, in October, 1908, that he would bid in the property for Parker, and allow him to redeem the same on repaying the amount required to purchase the same, his expenses, and a reasonable compensation for his time and trouble. Relying on this, Parker was induced to, and did request Ashcraft, and other responsible bidders who attended the sale to bid on the property, not to bid, because Robinson was bidding it in for him. Robinson, himself, stated to Sharp who was a bidder, on the morning of the sale, that he was purchasing the property for Parker. By reason of this, and because of the impression created among the bidders that Robinson was buying the property for Parker the debtor Robinson was enabled to, and did, purchase at this sale all of Parker's equity and interest in this property, which interest was of the value of $ 75,000, at a great sacrifice to Parker, and for less than four per cent of its actual value. Under these circumstances, it is inequitable, and unjust for Robinson to retain the property, and a court of equity will grant relief, and convert the purchaser into a trustee for the benefit of the debtor. Such a transaction does not come within the statute of frauds. Rose v. Bates, 12 Mo. 30; McNew v. Booth, 42 Mo. 189; Phillips v. Hardenburg, 181 Mo. 474; Slowey v. McMurray, 27 Mo. 113; Damschroeder v. Thias, 51 Mo. 103; O'Fallon v. Clockton, 89 Mo. 284; Turner v. Johnson, 95 Mo. 431; Leahey v. White, 123 Mo. 207; Richardson v. Champion, 143 Mo. 538; Phillips v. Jackson, 240 Mo. 335; Pomeroy, Eq. Jur. (3 Ed.), secs. 1053, 1055; Perry on Trusts (6 Ed.), secs. 172, 215; 39 Cyc. 172, 176 (b). (2) Robinson, having by his acts and declarations, at and before the execution sale at Joplin, created an impression upon those attending the sale that he was buying the property in for Parker, thereby preventing competition in the bidding and obtaining an undue advantage to himself, will be declared by a court of equity to be a trustee for Parker whether there was any express agreement between him and Parker relative to the purchase of this property, or not. The fact that Robinson purchased the property in controversy for a grossly inadequate consideration, together with slight evidences of fraud, is sufficient to set aside this sale and make him a trustee for Parker, but when, as in this case, a large amount of property, -- being the holdings of a lifetime of Parker, -- are bought at public sale where those in attendance are under the impression that it is being purchased for the debtor, and at less than four per cent of its actual value, this is, in itself, such an inadequacy of consideration as to shock the moral conscience, and, as the setting aside of the sale and the granting of an accounting will not cause respondent to lose anything while a failure to do so will financially ruin the debtor, a court of equity will not hesitate to grant to plaintiff the relief prayed. Phillips v. Jackson, 240 Mo. 335; Leahey v. Witte, 123 Mo. 207; Phillips v. Hardenburg, 181 Mo. 475; Rose v. Bates, 12 Mo. 30; Slowey v. McMurray, 27 Mo. 113; State v. Elliott, 114 Mo.App. 562; Davis v. McCann, 143 Mo. 177; Hanson v. Neal, 215 Mo. 274.

McReynolds & Halliburton for respondent.

(1) If, under the petition in the case, the court can in any way construe it into an implied trust, then the plaintiff must fail because the evidence of such trust is not clear, strong, unequivocal, and so definite and positive as to leave no room for doubt in the mind of the chancellor. Curd v. Brown, 148 Mo. 92; Pitts v. Weakley, 155 Mo. 109; Garrett v. Garrett, 171 Mo. 159; Brinkman v. Gunken, 174 Mo. 709; Heil v. Heil, 184 Mo. 666. (2) The following agreements intended to create trusts are held to be within section 2868, R. S. 1909 (sec. 3416, R. S. 1899), and can only be proved by writing: (A) An agreement by wife to convey to her husband land which he has conveyed to a trustee for her benefit. Price v. Kane, 112 Mo. 412; Crawley v. Crafton, 193 Mo. 421. (B) An agreement that a warranty deed shall convey less than the whole title when there is no fraud or mistake and the deed was not intended as a mortgage. Rogers v. Ramey, 137 Mo. 598. (C) An agreement to purchase land at an execution sale and hold it for another. Hammond v. Cadwallader, 29 Mo. 166. (D) An agreement that grantee in a deed, absolute on its face, would sell the land as agent for the grantor and account for its proceeds. Peacock v. Nelson, 50 Mo. 256. (E) An agreement by the purchaser at a trustee's sale that the purchase was merely to secure his debt, and that he designed afterwards to reconvey. Mansur v. Willard, 57 Mo. 347. (F) An agreement made at the time of the conveyance of the land that the grantee should pay off incumbrances thereon and should reconvey on the grantor repaying him the money so advanced. Hillman v. Allen, 145 Mo. 638; Miltenberger v. Morrison, 37 Mo. 71; Hull v. Small, 178 Mo. 629; Heil v. Heil, 184 Mo. 665. (3) If it should be admitted for the sake of argument for the plaintiff's contention, that the defendant Robinson did agree to buy in Parker's property under the circumstances alleged in plaintiff's petition, yet the plaintiff could not recover for the transaction could be treated in no other light (in view of the conceded facts in this case) than as a contract with defendant to aid him -- plaintiff -- in the hindering, delaying and defrauding of his numerous other pressing creditors, and therefore, for this reason, it would be impossible for him to maintain this suit. Where the agreement made, tends or has for its purpose the hindering, delaying or defrauding other creditors, no trust can result to him who is guilty of the fraudulent scheme. Miller v. Davis, 50 Mo. 572; Buren v. Buren, 79 Mo. 538; Sells v. West, 125 Mo. 630.

BROWN, C. Blair, C., concurs. Lamm, C. J., Graves, Brown and Walker, JJ., concur. Faris, J., concurs in the result. Woodson and Bond, JJ., not sitting.

OPINION

In Banc

BROWN C. --

This suit was instituted May 18, 1909, in the Jasper Circuit Court at Carthage, by Charles A. Parker, who has died during the pendency of this appeal, and it has been revived in the name of Pauline Ferguson, his only heir. It was tried at the June term, and on July 31, 1909, after the evidence was all in, the plaintiff, by leave of court, filed an amended petition, which, omitting the caption, is as follows:

"Now comes the plaintiff and for his amended petition herein states that on the day of October, 1908, he was the owner of the following described real estate in Jasper county Missouri, to-wit:

"The south half of the south half of section twelve, and the north half of the north half of section thirteen, township twenty-eight, range thirty-two, and two acres as follows: 165 feet east and west by 528 feet north and south off of the east end of the north two-fifths of the east fifty acres of the north half of the northeast quarter of section eighteen township twenty-eight, range thirty-two; the north half of lots sixty-five and sixty-six in the original town of Webb City, and a tract beginning 23 feet north of the southwest corner of lot forty-five in the original town of Webb City, thence running east 100 feet; thence north 100 feet; thence west 100 feet; thence south 100 feet to place of beginning, and the undivided one-half of the north 37 feet of lots forty-five and forty-six in the original town of Webb City, and fifteen acres in the southeast corner of the southeast quarter, and the undivided one half of the east twenty-five acres of the southeast quarter of the northwest quarter of section twenty-nine, township twenty-eight, range thirty-two; that on said day said property was worth the sum of one hundred and ten thousand dollars, and there was against it and other property owned by this plaintiff an aggregate indebtedness of forty thousand dollars; that the other real estate in said county belonging to this plaintiff and not specifically described above was of the value of forty thousand dollars; that certain judgments had been rendered against this plaintiff in the circuit court of Jasper county, Missouri, upon which executions had issued and the real estate above described was advertised for sale by the sheriff of said county and the amount of the executions in the hands of the said sheriff were less than two thousand dollars; that the two acre tract above described at said time was free of mortgage and other liens except said judgment, and was of the value of three thousand dollars; that when said property was advertised for sale, and at all times mentioned in this petition, and for many years prior thereto, the plaintiff and the defendant were warm personal friends. The defendant used to be a practicing lawyer at the Jasper County Bar and during said time was the attorney for the plaintiff; that while the defendant was so practicing law, he was elected judge of the above named court and subsequently elected to the Supreme Court of the State, and after his term of office had expired, was again practicing law in Jasper county, Missouri; that when the plaintiff's property above described was advertised for sale, he appealed to the defendant, who was a man of large means, to bid in the property for him at the execution sales above mentioned, and agreed to pay the defendant therefor in addition to the amount expended by the defendant, interest on expenditures, and in addition thereto, a...