First Nat. Bank v. Tompkins

• Decision Date: 22 May 1893
• Docket Number: 109.
• Citation: 57 F. 20
• Parties: FIRST NAT. BANK OF SHEFFIELD et al. v. TOMPKINS.
• Court: U.S. Court of Appeals — Fifth Circuit

57 F. 20

FIRST NAT. BANK OF SHEFFIELD et al. v. TOMPKINS.

No. 109.

United States Court of Appeals, Fifth Circuit.

May 22, 1893

David D. Shelby, for appellants.

R. C Brickill, (Brickill, Semple & Gunter, on the brief,) for appellee.

Before PARDEE and McCORMICK, Circuit Judges, and TOULMIN, District Judge.

PARDEE Circuit Judge.

On the 15th December, 1889, the appellee filed a bill in the circuit court against the appellants to enforce and foreclose a vendor's lien on one undivided half interest in and to lots numbered 13 and 14, block No 62, on Montgomery avenue, in the city of Sheffield, county of Colbert, in the state of Alabama; and therein alleged that being the owner in full fee simple of said one undivided half interest, he did, on the 5th April, 1887, or some date subsequent thereto, execute a deed to said one undivided half interest to Charles D. Woodson, then president of the First National Bank of Sheffield, with the understanding and agreement that said two lots were to be deeded by said Woodson to said bank; that the price to be paid therefor was, as expressed in said deed, $4,000; that no part of said purchase price of said interest was ever paid by said Woodson or by said bank; that the said Woodson, as president of said bank, acting for and by authority of the board of directors of said bank, had full knowledge, as did said bank itself, that the purchase was made by Woodson for the bank; that the purchase money has never been paid, in whole or in part; that no note was taken for said purchase price of $4,000, because it was understood and agreed that it was a cash transaction, and that the purchase price would shortly be paid, with interest at 8 per cent. per annum; that the deed dated the 5th April, 1887, was not actually acknowledged and delivered until the 23d of October, 1888. It was further alleged in said bill that on the 6th day of April, 1888, said Woodson, who held title to the other one undivided half interest in said two lots, deeded the whole interest in said lots to the bank, and that at the time said bank accepted the deed said Woodson, the president of the bank, as well as the bank itself through its proper officers and board of directors, had actual knowledge or were put upon legal notice that the said undivided one-half interest had not been paid for in whole or in part; and, further, that he, Tompkins, is not now indebted to said Woodson or to said bank in any sum whatever. The prayer of the bill was for a decree subjecting the undivided half interest in said two lots to the payment of the vendor's lien. Discovery under oath from the defendants was expressly waived.

To the bill, Charles D. Woodson answered, admitting the conveyance and the price, but denying that no part of the price was paid to complainant by defendant. On the contrary, he says:

'The full amount of said purchase price, to wit, four thousand dollars, ($4,000.00,) was by this defendant paid to and received by complainant before said deed was made, or was by defendant paid out on complainant's account at his instance, or upon his request before that time; and when said deed was made defendant was not indebted to the complainant in the sum of four thousand dollars on account of the purchase of said interest in said two lots, or in any sum at all.'

Defendant Woodson further admitted that he was the president of said bank, and so remained until the 30th day of November, 1889, when it went into the hands of a receiver, to be wound up as provided by the laws of the United States. The said answer denies that in making the purchase Woodson acted for, or by authority of, the bank, or for its board of directors, or that the bank had full knowledge or any knowledge of defendant's action in the premises; and he says that the purchase was entirely an individual matter between complainant and the defendant, with which the bank or its board of directors had nothing whatever to do. But when he conveyed said lots to the bank he stated to its board of directors that said purchase money had been fully paid, and that he conveyed to them the unincumbered fee-simple title to said lots, and said bank had no knowledge or notice of any claim thereon of complainant, and, in fact, complainant had no claim on said lots at that time, nor since; and he avers that the complainant now owes the bank more than $7,000, money borrowed by him from said bank since the said deed was made, for which he executed his notes, which notes are unpaid, and which are now held by the said bank or its receiver.

The bank answered, admitting that the complainant owned at one time a one-half interest in the property described in the bill; the conveyance to Charles D. Woodson; that Woodson was the president of the bank, and had conveyed the whole property to the bank, but alleged full payment of the purchase money to complainant before the deed was put to record; that the deed from complainant to Woodson was the only evidence and information which was presented to the bank of the ownership of the undivided half interest sued for, and the board of directors relied upon the recitals of the deed from complainant to said defendant as being true, and that at the time of the purchase from Woodson of the lots, which were for the purpose of erecting a bank building, the bank did not have any notice or information of any character whatever of any unpaid balance of purchase money upon the property in question; that Woodson assured the directors at the time the bank purchased the property that the recitals of the deed made by the complainant to him were true, that the entire purchase money was settled and paid. Further answering, the bank says that at the time the said Woodson made and executed his deed to the bank the bank paid said Woodson $5,000, as is stated in said deed, and had no knowledge or information or notice of any outstanding title, equity, or adverse interest of any kind or description; and there was no fact within the knowledge of the bank which could or did put the bank on inquiry as to the title to said property, and the bank relied on, and was entitled to rely on, the bona fides of the record of the deed from the complainant to said Woodson and from said Woodson to the bank.

On final hearing in the circuit court, a decree was rendered in favor of the complainant, recognizing his lien on the lots in question to secure the payment of $4,000, with interest thereon, aggregating $5,813,33, and ordering the bank to pay said sum, with...