Fisher v. Green

Decision Date12 May 1892
Citation31 N.E. 172,142 Ill. 80
PartiesFISHER et al. v. GREEN et al.
CourtIllinois Supreme Court

OPINION TEXT STARTS HERE

Appeal from appellate court, first district.

Bill by Valeria W. Fisher, Flora M. Chisholm, Justus P. Fisher, and Marcus S. Fisher against Hetty H. R. Green, Benjamin E. Gallup, and George W. Miller, for redemption. Defendant Miller was defaulted. Bill was dismissed for want of equity, and the decree was affirmed by the appellate court. Complanants appeal. Affirmed.Consider H. Willett

, for appellants.

L. H. Bisbee, for appellees.

BAILEY, J.

This was a bill to redeem, brought by the widow and heirs at law of Charles G. Fisher, deceased, against Hetty H. R. Green, Benjamin E. Gallup, and George W. Miller. Defendant Miller was defaulted for want of an answer, and, defendants Hetty H. R. Green and Benjamin E. Gallup having appeared and answered, the cause was heard on pleadings and proofs, and on such hearing the court found that the complainants were not entitled to the relief prayed for in their bill, and entered a decree dismissing said bill at their costs for want of equity. On appeal to the appellate court said decree was affirmed, and the present appeal is from said judgment of affirmance.

The facts shown by the pleadings and proofs are these: On the 15th day of March, 1872, George W. Miller borrowed of Mrs. Green the sum of $7,000, and executed to her his promissory note of that date, for the amount of said loan, due five years after date, and bearing interest at the rate of 10 per cent. per annum, payable semiannually, and to secure said note said Miller executed to said Benjamin E. Gallup, as trustee, a deed of trust conveying 20 acres of land in cook county, said deed of trust containing the usual power of sale in case of default in the payment of said note. Miller after wards sold 10 acres of said land to parties not now before the court, said sale being made subject to one half of the incumbrance of said deed of trust, and said purchasers subsequently paid the half of said incumbrance, and obtained from said trustee a release of their lands therefrom. On March 24, 1873, Miller sold and conveyed the remaining 10 acres to said Charles C. Fisher, who assumed and obligated himself to pay the remaining one half of said deed of trust, and also executed a second deed of trust on said 10 acres to Horace A. Hulburd, as trustee, to secure three notes for $2,875 each, payable to the order of said Miller, and maturing in one, two, and three years from the date thereof. The first of these notes was paid at or about the date of its maturity. In 1874 Fisher subdivided the 10 acres purchased by him into 96 lots, of which he conveyed to a Mr. Snow 24, subject to one eighth of the incumbrance held by Mrs. Green, and to one fourth of that held by Miller; and on the 8th day of July, 1876, Fisher and wife executed to Miller a quitclaim deed conveying to him the remaining 72 lots, Miller in and by said deed assuming the payment of Mrs. Green's incumbrance, and agreeing to save Fisher harmless from his previous assumption thereof. Miller at the same time canceled the remaining two notes executed by Fisher to him, and procured from Hulburd, the trustee, a release of the deed of trust securing the same. The deed from Fisher and wife, and the release by Hulburd, were promptly placed on record. It is now claimed, and there is evidence, though not of the most satisfactory character, tending to support the claim, that the conveyance of said 72 lots by Fisher and wife to Miller, though absolute on its face, was in fact intended by the parties as a mortgage, it being insisted that the transaction between the parties was in substance that Miller should sell said lots, and, after retaining a sufficient sum of money to satisfy and discharge said incumbrance, account for and pay the residue over to Fisher. On the 11th day of January, 1878, said Fisher died intestate, and on the 10th day of the following July, default having been made in the payment of the remaining one half of Mrs. Green's incumbrance, Gallup, the trustee acting under the power of sale in the deed of trust to him, sold the entire 10-acre tract, which included the 72 lots conveyed by Fisher and wife to Miller, Mrs. Green becoming the purchaser, and receiving a trustee's deed conveying said 10-acre tract to her. She thereupon entered into possession of said tract, and caused said subdivision to be vacated, and has ever since remained in possession thereof. The present bill was not filed until December 24, 1889. It is not claimed that said trustee's sale was not conducted in all respects in strict conformity with the terms of the power of sale in the Gallup deed of trust, the contention being- First, that, as the conveyance by Fisher and wife to Miller was intended only as a mortgage, Fisher retained and held, up to the time of his death, the equity of redemption from said deed of trust; and, second, that, as Fisher, the owner of said equity of redemption, had died prior to said sale, the sale under the power was prohibited by the statute, and was therefore void.

The record furnishes us with no evidence as to the precise grounds upon which the chancellor who heard the case in the circuit court reached the conclusion that the complainants were not entitled to the relief prayed for in their bill, and we may therefore, in support of his decree, assume that all controverted questions, both of fact and of law, were decided adversely to the complainants. One of the questions of fact presented at the hearing was whether the deed from Fisher and wife to Miller was intended by the parties as an absolute conveyance or as a mortgage; and we are inclined to the view that the evidence on that subject is so unsatisfactory that a finding upon that issue adverse to the complainants should not be disturbed on appeal. In the firrst place, the deed being absolute on its face, there arises from the form of the instrument itself a presumption that an absolute conveyance was intended, of such strength that it will prevail, unless overcome by clear, convincing, and satisfactory evidence that a mortgage was in fact intended. In Helm v. Boyd, 124 Ill. 370, 16 N. E. Rep. 85, we said: ‘A deed absolute on its face may be shown by parol to be a mortgage. The law will, however, presume, in the absence of proof to the contrary, that such deed is what it purports to be,-an absolute conveyance. The party who claims an absolute deed to be a mortgage must sustain his claim by proof sufficient to overcome this presumption of the law. Before a deed absolute in form will be held to be a mortgage, the evidence must be clear, satisfactory, and convincing. It must be made to appear clearly that such conveyance was intended to be a mortgage at the time it was executed. The question is one of intention, to be ascertained from all the circumstances.’ The rule thus stated is supported by the following decisions: Hartnett v. Ball, 22 Ill. 43;Hancock v. Harper, 86 Ill. 445;Bartling v. Brasuhn, 102 Ill. 441;Eames v. Hardin, 111 Ill. 634;Bailey v. Bailey, 115 Ill. 551, 4 N. E. Rep. 394; Tedens v. Clark, 24 Ill. App. 510;Strong v. Strong, 27 Ill. App. 148. But the theory that the conveyance was intended to be absolute, and not by way of mortgage, is very greatly strengthened by the circumstance that at the time the deed was executed Miller canceled the promissory notes which he held against Fisher, and it does not appear that any other notes evidencing the indebtedness were executed in their stead, or that there was any distinct agreement or understanding that said indebtedness should be regarded as subsisting so as to constitute a personal obligation on the part of Fisher. The presumption seems rather to be that the cancellation of the notes was intended by Miller as a cancellation of the indebtedness, and that the obligation on the part of Fisher to pay it was thereby terminated.

It is a general, if not a universal, rule that there can be no mortgage without a mortgage debt. Tied. Real Prop. § 310. One of the principal tests by which to determine whether a conveyance of lands made in consideration of the grantor's indebtedness to the grantee is to be deemed an absolute sale or a mortgage is the effect which the parties intend the conveyance shall have upon the indebtedness itself. As said by Mr. Jones in his treatise on the Law of Mortgage: ‘If the indebtedness be not canceled, equity will regard the conveyance as a mortgage, whether the grantee as so regarded it or not. He cannot at the same time hold the land absolutely and retain the right to enforce payment of the debt on account of which the conveyance was made. The test, therefore, in cases of this sort, by which to determine whether the conveyance is a sale or a mortgage, is to be found in the question whether the debt was discharged or not by the conveyance.’ 1 Jones, Mortg. § 267. Substantially the same doctrine is laid down in Sutphen v. Cushman, 35 Ill. 186. In Freer v. Lake, 115 Ill. 662, 4 N. E. Rep. 512, it was held that a debt or obligation of some kind is an essential element in a transaction to create the relation of mortgagor and mortgagee. In that case the mortgagor of lands conveyed the mortgaged property to a third person, by a deed containing a clause obligating the grantee to pay the mortgage debt. Said grantee subsequently conveyed the property to the holder of the unpaid notes, under a promise by the latter to give the party so conveying to him whatever could be made out of the property in the next three years, above the debt, interest, taxes, insurance, and repairs, and it was held that the mortgage debt was thereby extinguished, and the relation of mortgagor and mortgagee no...

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